By Dayv Morgan
In today’s seller’s market, homebuyers face a real challenge.
They are competing with many others for existing homes, facing higher and higher bids and are often on the wrong side of negotiations. Homes are selling within days of being listed, leaving buyers exhausted and frustrated.
That is driving more homebuyers to new builds, a situation that seems to be a win-win for both builders and buyers. Even in a seller’s market there are no multiple offers with new homes, just first come first serve. If you can wait, typical build time is six to eight months right now.
Builders often have incentives, such as paying your closing costs, if you use their preferred lender. In such a competitive resale market it is unlikely that a seller will agree to pay these costs for you.
With a new home, buyers have varying degrees of options. Some new homes come with everything pre-selected, which is great for first-time buyers and the budget-conscious. Others have full design centers with many customizable features, although it comes at a higher cost.
Homebuyers should make sure they understand what each homebuilder considers to be “standard” rather than an upgrade. Simply comparing the base prices of each builder is not enough. If you choose the lowest price, you may be disappointed to find there is an extra cost for a covered patio, nine-foot ceilings instead of eight-foot, tile instead of vinyl, and other options you thought were included.
This is especially true when looking at the model homes; it’s not uncommon for them to have $100,000 or more in added upgrades.
On the plus side, new homes are more energy efficient than most resale homes and include warranties of up to 10 years, so you can have peace of mind that you won’t need to spend money on repairs right away.
Even with the builder guarantee a home inspection is still recommended before closing. On your one-year anniversary you can have the builder come back and fix any defects that you have found. However, you are likely not looking in the attic or on the roof, and there could be major structural problems not discovered until you sell and the buyer does their home inspection. And then the repairs will be your responsibility.
Dayv Morgan is a Maricopa Realtor and owner of HomeSmart Success.
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