Home buyers have an option to buy an older home or a brand new house. Often, buyers who love to get the latest and greatest of modern amenities that new home builders can offer choose to buy newer homes instead of older ones. Here are some tips on how to buy a brand new home.
Things You'll Need
- Home builders in your areas of choice
- Model homes
- Real estate agent
- New home listing
- Good credit
- Bank account
- Money for down payment
- Job or source of income
Consider location. Before you start searching for new homes, decide which areas you and your family would like to move to. If you have small children, make sure that there are good schools nearby. You may also prefer to find a place close to all the other necessities such as hospitals, groceries and parks.
Decide on a price range. As long as you know your budget limitations and you know how to stick with what you can afford you will be able to find the right house for the right price. Price is dictated not only by the size of the home, or by the market situation, but also by location. If you are ready to deal with a longer commute just to get a bigger house for a lower price remember to factor in the gas and fare prices when you decide on a budget.
Get your home buyer's loan pre-approved first before you even visit the new communities. This will speed up the process for you.
Since most communities are towards the suburbs or inlands, the average commute is from 30 to 45 minutes without traffic to 50-60 minutes with traffic. If you are on a tight budget, you may want to consider buying a home in places farther from the main cities or places of employment.
Hire a real estate agent who will represent you. Working with a realtor will make the search simpler and your realtor can work with builders to negotiate down the price. You do not need to pay the realtor since they will get paid a commission by the builder. A realtor can do much of the research and leg work.
Visit the communities and tour the model homes. Normally each new community will have different models for different needs and requirements.
Choose your family's needs and lifestyles. Would you rather have a big kitchen that opens into the family room or would you rather have a smaller kitchen but a bigger formal living room and dining room?
Once you have chosen the model, the price negotiation can start. The home prices listed on the fliers are not final, especially if you are buying during a buyer's market. If you are lucky you can lower down the price by the thousands and you can even ask for perks such as a free refrigerator or washer and dryer. Some builders would even offer to do the backyard landscaping for free as a promotion to entice buyers, and in some luxury communities they would even throw in the swimming pool for free.
After negotiating the price and you have chosen the lot number, the builder will then request for you to fill out an application form and sign some papers. Even with a pre-approval, most builders will still run your credit report because it is their standard requirement. There are some who would prefer you work with their lenders to finance your home, either way insist on the best option for you. They would also more than likely ask for a check to hold the lot for you. So do not forget to bring your check book when you go on a house hunt.
After the builders have completed checking out your application, you will then be asked to choose your upgrades. Do not go overboard or over budget. Remember that any upgrades you want to put in will increase your total purchase price which will also increase your property tax if your state has one. Choose upgrades that would be hard to do yourself or you think would be cheaper to go with the builder.
Some builders will allow you to go through preliminary inspections while your house is being built. This gives you an opportunity to see the type of workmanship going into your home. During each stage they will explain to you what takes place. This will give you a better idea on how things are put together and how they will work.
Take a final walk-through. After the house has been completed, which is days before your closing date, you will do a final walk-through of the house with a representative from the builder. Bring a checklist with you or use your builder's checklist. Make sure to inspect everything during the walk-through and mark anything that does not work properly so that the builders can address them before your closing date. Schedule another walk-through of those problem areas to see if they have been fixed. Make sure before you sign, that everything is in proper order.
Get a warranty. New home builders give a warranty on the quality of the homes they build. Depending on the state where you will buy, they range from 2 to 10 years. Be sure to read the fine print on what is included in the warranty under what conditions. Make sure to get the appliances registered so that when they break you can have them fixed.
Make sure you get everything including at least two sets of keys and garage door openers. Then be ready to move in and enjoy your new home.
- Photo Credit Josie Borlongan