Few things are as exciting as purchasing a newly constructed home. Everything is pristine and, presumably, will last for a very long time.
However, just because a house is new doesn’t mean it’s free of flaws. There are a lot of factors that could make a brand-new home a less than ideal purchase.
So, before closing on a new-construction home, here are some things you need to consider.
1. Quality of the build
“They don’t make ’em like they used to” is a common phrase that refers to the solid construction of many older homes. It can be true for a number of reasons—from the building materials used to the skills employed in the building process. Therefore, one of the most important things you can do with a new-construction home is to check the foundation to ensure there are no issues, since this can be costly to fix.
“Is the home oversized or undersized for the neighborhood? Do the materials and style of construction match the neighborhood?” Outlaw warns that purchasing a cheap build in a nice neighborhood will have ramifications—like costly repairs—further down the line.
2. The builder’s reputation
One way to minimize the chances of purchasing a low-quality home is to find out as much as you can about the builder. Outlaw recommends doing your research to find out what others think about the company. Is the builder known for taking shortcuts during the construction process? Does the builder have a reputation for paying its subcontractors and suppliers on time?
Robin Kencel, a broker at Compass in Greenwich, CT, agrees.
“Some of the first questions I ask the listing agent are about the team behind the house: who are the architect, builder, subcontractors, and engineers involved in the project,” Kencel says. “Those answers will help me gauge the strength of construction.”
It’s also a good idea to ask either the builder or the listing agent for references from people who have purchased a home from the builder.
“If the community is partially built and there are folks already living there, knock on some doors and ask what their experience was like and if they are satisfied with the final product,” says Bill Golden, an independent real estate agent with Re/Max Around Atlanta.
3. Possible upgrades and design options
Sometime buyers will get to choose the design elements in new-construction homes that have yet to be built. The builder will offer options for features like the countertop, flooring, tile, and more. Plus, there’s often the possibility of adding upgrades (for a price) like a kitchen backsplash or a water softener.
But it’s wise to avoid the temptation to go overboard. Sometimes it may be better to just stick with the standard features and upgrade them later when your budget permits.
“Ask to see what the standard fixtures/design elements look like, and what it costs to upgrade them,” says Golden. “However, things like tile and flooring make more sense to have the builder do, as changing those out later can be too much trouble to do.”
4. A warranty
You shouldn’t expect to have any problems in a new home for a long time. But if you do, it’s important to be covered. Before you buy a new-construction home, make sure it comes with a warranty.
“Most builders have, at minimum, a customer care program and a first-year warranty, plus a longer-term structural warranty,” explains Alan Beulah, vice president of sales and marketing for M/I Homes in Charlotte, NC.
For example, Beulah’s company offers a 15-year structural warranty that protects mechanical systems and other major structural elements.
But there may be an even bigger issue than honoring the warranty.
“You have to make sure that the builder is one that will be around and able to carry out warranty work,” says Jeff Benach, principal at Lexington Homes, a Chicago-based homebuilder.
5. An experienced real estate agent
When looking for a new-construction home, don’t forget to hire a real estate agent who has experience representing new-construction buyers.
“An experienced agent will negotiate with the builder to ensure pertinent items are covered during the first year of homeownership,” says Patrick Garrett, a broker and owner at H&H Realty in Trussville, AL.
Some of these items include coordinating a punch list (a document showing work that still needs to be done on your new home), a structural and mechanical warranty, and any agreements to fix cosmetic issues that are not noticed during initial inspections or the final walk-through.