Thinking of buying a new construction home in 2021?
Buying a New Construction Home is much different than buying a re-sale home. A re-sale home is a home that is owned and occupied by someone else who is now selling their home to the next owner. We will refer to a re-sale home as an existing home in this article. Whether you are thinking of buying an existing home or a new construction home, as a buyer, location and lifestyle should remain the primary focus. As a Realtor, I sell homes throughout the state of Florida and each of our states 6 regions are different and unique.
Per HBW, for the first three quarters of 2020, the State of Florida has enjoyed a 12% year over year growth in new construction. In the Southeast, 7,613 new residential construction permits were initiated (3% YOY growth). 60% of all new residential construction permits were issued in the Regions of the West, Southwest and Northeast.
Buying a new construction home is different than buying an existing home. First there are 3 types of new construction home phases available to purchase. They include Plan Inventory, Coming Soon Inventory and Inventory Ready Homes. Ideally, developers prefer a sell-out prior to the completion of the construction. Buyers, for the most part, prefer Inventory Ready Homes and Coming Soon Inventory. Many times, Plan Inventory, may be too uncertain to commit. Its important to have a Realtor by your side to navigate and understand the benefits and pitfalls of each construction phase.
5 Top Reasons to Buy a New Construction Home
1. Amazing Specials and Incentives. Many builders are willing to negotiate a lower price or builder incentives when the inventory level becomes higher than desired. Most builders prefer to sell out during the construction phase and do not want to carry Inventory Ready Homes. Also, when the project comes close to completion, some builders reduce prices to move the remaining homes for sale.
2. Get Closing Cost Assistance. Many builders refer buyers to their in-house Lender. For the builder, the in-house lender adds a layer of comfort that the buyer will actually close and take possession of the new home. For the buyer, the in-house lender may be able to provide closing cost assistance which could add up to thousands of dollars in savings. It's important to review the loan estimate to guarantee that the savings will be realized when the sale closes.
3. Inventory Ready Homes Are Beautiful. Inventory Ready Homes are "move-in" ready for the new owner. And they are almost always flawless and all the decisions in flooring, lights and any upgrades have already been decided by the builder. It is important that a Home Inspector is hired to inspect the new construction home. If there are any items that the Inspector "calls-out", the items should be shared with the builder to be remediated prior to finalizing the sale.
4. Cost of Insurance is Less. The cost of insurance is typically less on new construction homes due to the fact that most new construction homes are more energy sufficient and utility is less. Insurance companies are comforted that there are no home repairs needed and that all wind mitigation items will be non-existent. When the wind mitigation is top notch, the cost of insurance is at its lowest.
5. Grow with Your Neighborhood. Everyone is a first time buyer in the new community and a new neighbor to everyone. This element of "new community" fosters a sense of community participation with block parties, children playing together, adults getting together to enjoy the benefits of the master plan (pools, tennis, etc). Friendships are created that last for years.
Buying new home construction can be an exciting and euphoric experience. It is important to accompany your Realtor to all new Construction appointments or walk-ins. Once you register with your Realtor, your Realtor will be at your side to assist you with the purchase process.
Here is a link to my new construction site. I welcome you to visit the site and look for your dream home.