Questions to Ask When Buying New Construction

Buying a new home is exciting. Buying a brand new home can be even more so with the realization of being the first owner and possibly being able to choose your own layout and finishes. The prospect of owning new construction is definitely exciting, but it doesn’t come without its own set of questions. If you’re in the market for a new home, and considering new construction, make note of the questions below when you begin your property search.

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WHAT ARE THE LONG TERM PLANS FOR THE COMMUNITY?

Unless you’re looking at custom homes on acreage, it’s likely new construction in your area will be located in a new development or in a master planned community. With this in mind, feel free to ask about the plans for the community. If it’s a large area, find out if any subdivisions are planned. If there are only a few houses built so far, it’s likely to mean lots of construction in the months to come – which means a lot of noise and construction traffic. Also ask about the builder – if they’re well known and respected, it’s unlikely they’ll lose funding and the community will likely continue on as planned.

WHAT ARE THE HOMEOWNERS ASSOCIATION’S RULES AND REGULATIONS?

Many new developments and master planned communities come with a set of rules and regulations set by a homeowners association. If you’ve never lived in a community with a HOA, it’s important to find out the rules before investing in it. The bylaws and the CC&Rs will let you know what is and isn’t allowed in the community (especially when it comes to the exterior of your home). You’ll also want to find out when the HOA fee begins – in some communities, it can start before the home is even finished.

DO YOU OFFER ANY BUYER OR FINANCIAL INCENTIVES?

If the community or development is still in the early stages, there might be incentives (like a buyer discount, builder upgrades or other financial incentives or freebies) for buyers. Sometimes these offers come with a catch – where something is expected from the buyer in return for the incentive – but it’s important to ask about any offers that may be available, especially if the community is still up and coming.

DO YOU PROVIDE WARRANTIES?

New homes often come with different warranties. Ask if a workmanship and structural warranty come with the home. A workmanship warranty (or builder’s warranty) is a warranty for newly constructed homes that offer limited coverage on workmanship and components of the home like windows, siding, roofs, doors, plumbing, electrical and HVAC. Traditionally a workmanship warranty will cover a one or two year period; another likely warranty is a structural warranty, which covers the structure of a home. If a warranty is provided, make sure you know exactly what is and isn’t covered and how much you’re responsible for in case of any issues.

CAN YOU CONNECT ME WITH SOME CURRENT HOMEOWNERS?

Just as you would check reviews before buying an item online or booking a service, the same can be said for a home builder. Just because the product that’s being offered is a shiny new home doesn’t mean you shouldn’t do your due diligence and check references before making a large investment. While it’s likely that the builder will provide glowing reviews, checking reference and review websites and even knocking on the doors of current homeowners will provide additional information and give you a wider understanding of the builder and its practices. Talking to current homeowners will provide information about the actual community.

New construction is exciting, but you want to make sure you have all pertinent information before you go through with a home purchase. Your real estate agent will be able to help navigate the waters of new construction. Reach out to your agent with any questions you may have about buying new construction in your area.

If I could tell you only one thing when it comes to buying new construction it would be HIRE YOUR OWN REALTOR!  The builders and their real estate agents are only looking out for themselves usually. 

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Can You Afford a House?

Mortgages.  Depending on the price of your home and/or the amount of your down payment, there may be several options that fit your needs.  They include VA (for military veterans only) which allows 100% financing for the purchase, FHA (Federal Housing Administration) which allows a purchase with as little as 3% down and Conventional, generally the best option when putting down 20%. Did you know about the USDA Home Loan?  USDA loans are one of the only home loans available today with no down payment required.  Homebuyers may finance a home for 100% of the purchase price.  No Funds For Closing, 100% financing to buyers and closing costs can be paid by the seller or rolled into the loan, provided the home appraises for more than the purchase price.  It’s not Just Farmland, properties are often near desirable metropolitan areas like Basehor, Kansas.

I am super lucky to work with one of the best lenders in Kansas City.  Although, I know there are many excellent mortgage lenders in the area, I personally prefer someone that interact with on a personal and professional level.  Erik Lorfing at Mortgage Lenders of America has down all of my personal home loans and he is the one I refer all my friends and family as well.  He is has been in the mortgage business for years and knows what he is talking about.  One of the reasons my clients love him is that he can explain the mortgage process to you in way you understand it.  You know those silly mortgage commercials that use all that fancy wording and for some homebuyers, it just confuses them more.  When you are honest and genuine I think you will relate better, in my opinion.

When you work with an Exclusive Buyer Agent with RE/MAX(that would be me) in finding your home, they unequivocally represent only you and your best interests.  I will assist you in the mortgage process and make sure you understand every little detail.   You, as a Buyer, get the benefit of The Fred Perry Team’s experience in negotiating countless contracts over the past 40+ years.

You not only get the benefit of a my team’s experience, but it doesn’t even cost you anything.  As before, when all agents represented the Seller and the Seller paid their commission, the Seller still pays!  In most real estate transactions, there are two agents involved: one represents the Seller and we represent you.  The agents spilt the commission…that’s how we get paid.

Erik Lorfing

Mortgage Lenders of America

10975 El Monte

Overland Park, KS 66211

elorfing@mloanusa.com

Office: (913) 491-4299