- Make a List of Possible Builders with your Realtor
Talk with your realtor about the type of home you want: the characteristics, floor plans, design feel, lot location, pricing, etc that you are wanting. Once you have established these metrics, your realtor will be able to supply you with a list of potential builders that can meet your criteria. Your realtor will help you compare each builder’s product and process to see what may be the best fit for you. Reading reviews or asking a past client of the builder is also a great way to get a feel for their credentials.
Once you have decided on a builder that you like, I would suggest touring some homes that the builder has in progress. This will help you to see their product first hand, which will either confirm that this is a company you would like to build YOUR home, or letting you know you need to keep looking. If it is the right fit, this will give you the opportunity to pick out the floor plan and additional details such as materials, colors, upgrades, and elevation options (what you want the outside to look like) that you would like to see in your own home.
- Ask the Right Questions! (Your Realtor Can Help with This)
Besides establishing a price and move in date, here are some good questions to ask when building a custom home:
Understanding the Builder’s Process
- What materials are used?
- What is the build process/timeline?
- How does the financing of the lot work (will the builder carry the loan for your land)?
- Are there options in the floor plan — for example, can a basement, deck, bump outs, cantilevers, etc be added?
- How much “customizing” can be done versus standard features?
- Can appliances be up- or downgraded? What appliances are included (if any)?
- Are there any additional fees relating to the home or development?
- Will there be a homeowners’ association (HOA)? If so, what will the dues cost and what do they cover?
- Does the builder offer a warranty program? How long is the warranty? When do they come out to fix issues? What is commonly covered or not covered?
- Does the price include landscaping? If so, what is included in the landscaping?
- Are there any restrictive covenants (HOA or building covenants)?
- What are the standard finishes? Are there upgrade packages for finishes?
- Is the lot cost included? Will there be additional costs associated with the lot?
- Are you allowed to purchase your own appliances or materials?
- If you can bring in your own materials or appliances, will you get credits?
- What if you change your mind on selections? What there a cost for change orders?
- What is the cost of redrafting plans?
- What are the estimated taxes on the property?
- How is the school system rated?
- Are daycare and grocery stores convenient and satisfactory?
- What about emergency facilities — police, fire department, and hospitals?
- Amenities nearby – Parks, gyms, trails, etc
- What would your commute to work be like if you lived here?
- What is the neighborhood like?
- How much have similar homes sold for in the neighborhood?
- How long has the home been on the market?
- How many offers has the seller received?
- How much did the seller pay for the home? What improvements have been made?
- It’s also important to understand that most home values rise 2-3% each year. This will give you an idea if the listing price is fair based on appreciation, current market, and home condition/improvements.
Keep in mind that the current market conditions will affect how much you scrutinize a home. Real estate markets are subject to swings. It can be a seller’s market, a buyer’s market or a neutral market. If your market is on fire and smokin’ hot, you might not have enough time to ask any questions before that home is sold to somebody else. Ask your agent to give you professional insights into the type of market.
- Shop for Quality Craftsmanship and Value
Schedule showings with your realtor and have them send you online options of completed homes and construction in progress. You can also look at local home shows, spec homes, open house tours, and more to get a feel for quality craftsmanship and value. These options are also nice because many times they will be staged, which will give you a good idea of what that space would feel like with your furniture and decor. You’ll quickly start to see what builders feel like a good value for the money, what feels overpriced, and what isn’t quite hitting the mark for your tastes. In trying to get a good feel for the quality of construction, take a minute to note these features (below) in the homes you tour. the quality of construction, take a minute to note these features (below) in the homes you tour.
- Take Notes & Never Hesitate to Ask a Question
Realize that this is YOUR home. Use your time meeting with the builder to get every question that comes to mind answered. You are spending a great deal of hard-earned money building a home, so make sure that you understand the process and are in agreement on the terms of the build. Never hesitate to ask a question. We have been doing this a while so what may be a common thought to us, could be confusing for someone just starting the process. What seems like an insignificant question could yield a very important answer. So ask!
- Begin the Conversation Early
You may not be looking to start building for a while. Maybe 6 months to a year before you want to have that initial consultation to see what is out there. It’s never too early to begin the conversation and let your realtor know you are thinking about building. We have access to information about what is upcoming for most builders around the metro, so if we know what you are looking for, we can help keep you updated on what is to come. Maybe we have a spec home plan that just had a foundation poured? That’s really great timing for if you want to be in a home in 3-6 months. Maybe we need opinions on spec homes to build based on what upcoming buyers/custom builders may be looking at for a new home. There are many different scenarios where knowing what you are trying to accomplish ahead of time can play out in your favor.
- Think About How You Plan To Furnish Your Home, Not Just How You Want to Build It
If you are wanting an HGTV level home – we’re talking shiplap, built-ins, accents galore, plush furniture, decor for days, etc, etc – think about how that will affect your price. [It drives down my paycheck when I encourage you to build a smaller home, but I will give you all the possible options because I want what is best for YOU]. There are some people that want to max out their budget. This is absolutely fine, so long as it is comfortable for you and you have a plan for furnishing your home! Some clients welcome the advice to look at a very similar floor plan (flow/features wise) with a bit less square footage. This allows them to save on the pricing of the home itself, that way they can decorate it to the nine’s inside.
There are also some furnishings in new build homes that you don’t think about (because they may be included with a resale home), but you will need to plan for:
Additional Furnishings to Think About in New Build Homes
- Window coverings (blinds, curtains, etc)
- Appliances (most builders include Stove, Microwave, Dishwasher. Your realtor can help advise you on how to negotiate for getting the other appliances included with your offer (Fridge, Washer, Dryer, etc)
These additional expenses can be a bit disheartening, but (devil’s advocate here) new homes are normally a lot easier to maintain than resale homes. This is true because the home itself is new, as well as all of the mechanicals (Furnace, AC, Water Heater), appliances, etc. Additionally, the development is new (sewer lines, roads, sidewalks, etc). There are trade-offs either way of building versus buying an established home. It comes down to what is best for your situation. There’s just something really beautiful about designing your own home.
Hopefully, this helps make navigating the build process just a bit smoother.
Questions about Home Building? Let us know what we can cover next!
Contact Kelsey: 515.480.9388 | Kelsey@PrecisionDSM.com