With a shortage of homes for sale, more new homes are being built to meet the needs of buyers. Arizona has seen a nearly 24 percent increase in the number of new builds over last year. And who doesn’t want a fresh, never-before-lived-in house?
Still, buying a new build may not be the straightforward process it seems, so you should have a real estate agent on your side.
In fact, you may need even more guidance from an agent when buying a new build versus a resale home. They can help you negotiate extras and avoid paying for upgrades you don’t need, prevent you from overpaying for the house, connect you with the right lender, and oversee the home inspection. (Don’t let the shiny new facade convince you to skip the inspection—new construction is just as likely to have defects as resale.)
New Build vs. Resale Home
Buying a new build is different than buying a resale home. While you may have found your dream home without the help of an agent, your realtor will look out for your best interests throughout the purchasing process. The builder’s agent is a great source of information, but, at the end of the day, they have the builder’s best interests in mind. You need an agent looking out for you too.
When you buy a new build, the price will be affected by construction costs and upgrades. You can’t move in until your house is ready, and several things can pop up that impact that timeline. Your real estate agent will be knowledgeable about home prices and construction costs. They will keep you on budget and advocate for you, getting construction updates and urging the builder to stay on schedule. They can make sure you don’t pay too much for the house itself or any upgrades.
Negotiating the Contract
The purchase contract for a new build can be complicated. The language is builder-friendly, so without an expert to help you decipher it, you could end up agreeing to some unfavorable terms.
For instance, the builder might include an escalation clause that would make you responsible for paying for any increases in materials costs. With rising lumber prices, it could mean a much bigger price tag than you planned for. Your agent can negotiate a maximum price so you’re not stuck with a mortgage you can’t afford.
Your agent can also make sure quality building materials are used, the build is completed within a reasonable amount of time, and you don’t sign away your right to legal recourse if something goes wrong.
Get an Agent Before You Start Shopping
Although there are exceptions, most builders are happy to work with buyers' agents. Whether you’ve already found your next home or are still looking for the right new build, choose your real estate agent before you sign on, so you can register the agent with the builder at that time. If you don’t, the builder might not be willing to pay the agent’s commission.
If you’re ready to buy a brand new home and want a knowledgeable agent on your side, I’m here to help.