The 2018 Characteristics of New Housing Report by the US Census Bureau shows that over 840,000 single-family homes were completed during the year. The median size of the completed new construction home was 2,386 square feet, with the median contract price being $281,200.
Purchasing a new construction home is an exciting and fulfilling experience for most first-timers. You can pick just about everything in the new house, from the customized floorplan to window designs and kitchen cabinetry. But is there anything different when negotiating for a new construction home as compared to that of an existing home?
One important tip as you start your negotiation process with the local builder is that they may not be open to lowering their prices. The local builders may end up losing out on tidy profits if buyers are willing or already meeting their asking price. You may need to be shrewd as you present your offer.
Here are four tips on how you should go about making an offer for a new construction home and get the most value out of the purchase.
1. Get Yourself a Representative
As stated before, lowering prices for the homes for sale in the new subdivision will hurt the builder. You may need an experienced negotiator that understands the real estate industry to ensure that you aren’t missing out on vital information to help you save more. A realtor can inform you of the new homes available in the market, their value, and advice on the process of building one on your acreage.
2. Educate Yourself on the New Construction Home Buying Process
You may need to polish up your knowledge of the home buying process to ensure that you negotiate a good deal for your new house. Understanding the details regarding the new subdivisions and the lots available is key to identifying the right community for you. Reverse engineer the future of the new subdivision to calculate the appreciation in the value of the new construction home you intend to buy.
3. Figure Out the Incentives That the Local Builder Provides
It may be easier to negotiate upgrades for your new home than on the standard price set for the development. You may get to enjoy attractive deals on upgrades and additions. Your local home builders may throw in discounts for items such as customized countertops, cabinetry, and lighting. You may also inquire about warranties or guarantees on appliances within the home.
4. Find the Right Financier for You
You may need to team up with a lender with favorable terms for your mortgage. Most builders often have their preferred lenders that they require you to work with. Shopping around for outside financiers can help you analyze different rates and options. The fraction or small percentage point difference can save you thousands of dollars over the years. Besides, finding an attractive deal from outside lenders can prompt the builder’s preferred lender to counter with better rates for you.
Negotiating the right price for your new construction home is key to getting value for your investment. If you require guidance on the home buying process, reach out to Stone Meadow Homes.