NEW CONSTRUCTION

Racheallee’s advice, 3 Ways to Purchase New Construction

A growing housing stock in Pittsburgh leads to opportunity in Pittsburgh to purchase a brand-new home and completely customize it to your specifications. So, what are those options and what is the process?

Built on Spec:

Developers will build a home that is totally built on “Spec”. What does that mean? The builder will complete a home with their fit and finish to start a project to sell other homes in a plan. This is even more common when there are 3 or more homes in a project. Finishing out one as a “model” and using that home with a list of upgrades outside of the standard offering is typically the initial “model home”. Builders do this type of “Spec” build to also set an expectation of design, finish quality at the base price and to sell other homes in the development. It also gives buyers a vision on what the home will look, feel and live like.

Semi-Customizing and Build to Suit:

A buyer may come along before a home is even started and want to customize it to their style. This can sometimes be the wrong direction to go on your 1^st try in new construction, if you are not fully prepared. Having a buyer’s agent in new construction sales will be beneficial with a builder or listing agent to guide you through the process. Knowing the raw real estate market is key with end pricing in custom building for budgeting, materials and labor.

Steps are to:

• Research the Builder/Developer. Make sure their recent projects fit your style and aesthetic. Find recent projects that you can research the quality and perhaps interview the buyers that worked with them.
• Research other homes that you have seen within the price range of the budget you want to stay in. Download photos and put them into a Pinterest or create a Houzz idea book room by room. This will help guide the builders/architect/designers with fit and finish expectations on the allowances and provide you with an idea of what the upgrades in the home will be and costs associated.
• Keep in mind realistic value and pricing. What you see on HGTV and reality shows are NOT what really happens in real life. There is no one providing their product for free, where as on TV, vendors love to get their name out there and will provide fit and finish for these reality shows.
• Prepare yourself for the steps and making sure you know what you want. You will see a lot of ideas but make sure they are in your financial capabilities. Set budgets for upgrades.
• Have weekly meetings with the team you are working with to make sure selections are on time, decisions are made per the construction schedule (builder should provide one to you), all proper permits and zoning approvals are done properly for the property in which you are purchasing.
• Golden rule – DO NOT OVER BUILD. This can happen very easily. It is best to have a licensed real estate agent who is familiar with the pricing in the neighborhood as well as the market you are building in. Let them guide you so you do not make too many customizations where if you have to sell it in the near future, you can get your ROI.

Set Fit and Finish with Upgrades:

A new home build should come with a fit and finish catalog. This catalog is the standard offerings with upgrades. The builder has previously selected a fit and finish based on the current market trends. Realtors, architects and interior designers can help with this catalog given they have the knowledge in the market. The builder knows what their costs are and will allocate the budgets accordingly to the catalog. The catalog will list flooring, surfaces, appliances, tile, cabinets, plumbing, lighting, paint and specifications. Specifications can list; HVAC, windows, framing, doors, hardware, mechanicals, exterior finishes to just mention some.

Upgrade packages can host an a la carte of options from appliance upgrades, custom exterior doorways, additional outdoor spaces (that are not included), additional lighting (ceiling fans, pendants lights, sconces, automatic closet lights, i.e.) plumbing fixtures, surfaces, custom tiling in bathrooms. Endless items can be added to a homes standard offering for an upgrade fee* That fee is typically paid up front and non-refundable to the builder.

Additional things to know about buying New Construction:

A line item of fit and finishes should be on a spreadsheet with costs and photos of agreed upon and finalized selections prior to singing. If there is a 30-day review period (give or take the developers contracts) this is when you will select all of your finishes, go to showrooms, and work with the team on finalizing your home.

Floor plans will also be provided for any project you are looking for in new construction. The plans are usually a standard plan that may or may not have changing capabilities. Typically, there is a change order for this and is charged by the architect to the buyer of an hourly rate. Rates should be discussed up front so only one meeting for a change order takes place during build out. One item to remember is that structural moves and utility moves are costly. Only make them in the beginning if you are early on a pre-sale and the builder is willing to accommodate the request.

Builder & Home Warranty – “The Craftsmanship”

You will want to make sure that the builder has a warranty on their fit and finishes with all systems warranted for 1 or even 2 years noting items such as; roofing, structural . Once a home has been lived in, small kinks could pop up and this is common. But, when you start seeing drywall seams cracking or structural shifting in the home, that is a builder warranted situation (within time frame of warranty) and should be documented with photos, put into writing via email or certified mail with a call to the builder ASAP. Appliances have warranties provided by the vendor typically for one year. That is standard and comes with the home purchase at no additional cost. You will want to know who is doing the install on your appliances so that if a water line to the dishwasher is improperly installed, you want to know if it’s the builder warranty or the vendor warranty that covers this.

There is a lot more to discuss with buying a new construction home and further in depth details to provide. This is just the basic fundamentals of new construction purchasing.

Want to learn more and see your options? Give us a call, email or set up an appointment.