When you buy a new construction home, there are three main mistakes you should avoid:
1. Not hiring a real estate professional. A lot of times there is room for negotiation when you buy new construction - if you know where to look. For example, we have a client who just went under contract and the home is halfway built. I was able to get them $20,000 off the asking price and a $5,000 credit for blinds. There are many nuances in the new construction contract, and you need a real estate agent by your side to negotiate price, terms, and conditions.
2. Not doing research. You need to research the property and the surrounding environment. A lot of new construction homes are in underdeveloped areas; it’s important to know what kind of infrastructure will be going into that area over the next three to seven years. You should also know how that will affect your home’s value and its sellability in the future.
3. Neglecting Paperwork. New home builders have their own contracts instead of the standard California Association of Realtors contract. I have a client who has a new construction contract with 164 pages. There is a lot of fine print to go through. Luckily, I noticed that this contract would have required the buyer to pay $3,000 in closing costs and was able to save them that money. Again, that’s why you need to hire a real estate agent - to catch things you might not know about.
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A real estate agent will guide you through negotiations and mountains of paperwork.
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If you have any questions about buying new construction or about real estate in general, give me a call or send me an email. I would be happy to help you!
