Buying a home in a competitive market can feel like being in a gladiator ring, with multiple showings and bidding wars that leave you feeling defeated. If you’re tired of sifting through a limited inventory of existing homes, it might be time to consider buying a new construction home.
According to the National Association of Home Builders, the number of single-family homes being constructed is expected to increase in 2021, albeit at a slower pace than the previous year. Builder confidence in the market for single-family homes reached a record high in November 2020, and while it dipped slightly by the end of the year, the NAHB predicts that the construction of residential homes will play a vital role in the economic recovery this year.
With more new construction homes available for sale, there may be less competition in your market. If you’re tired of being on the sidelines, here are four factors to consider when buying a new construction home.
Customization at Your Fingertips
Not all of us have the interior designer’s touch. However, when purchasing a new construction home, you’ll often have the opportunity to choose a floor plan, housing lot, type of community, and expert-selected features, sparing you the need for extensive remodeling to achieve your dream home.
Potential Builder Incentives
Believe it or not, there’s room for negotiation when dealing with a builder. While a discount on the purchase price may not be feasible, you might be able to negotiate for material or structural upgrades. Some builders may even sweeten the deal by offering to cover closing costs, initial mortgage payments, property taxes, insurance premiums, or homeowners association fees for a specific period. If incentives aren’t advertised, don’t hesitate to inquire about them. They may be available even if not explicitly mentioned.
Builder Warranty Benefits
Builder warranties can vary, but they typically cover workmanship and materials for a defined period, often one year. These warranties also outline the procedures for repairs. Before making a decision, ensure you understand what the builder warranty encompasses and how long it lasts. Builder warranties are meant to address common post-construction issues that the builder is responsible for rectifying.
Financing Flexibility
Some builders offer a convenient one-stop shop, allowing you to customize and finance your home directly through them or a preferred mortgage lender. However, there are a few things to bear in mind when considering new construction financing. Certain lenders may require higher down payments, an excellent credit score, and a consistent payment history for new-home loans. Additionally, if you opt for outside financing, your lender will assess the builder’s credit and background to evaluate the level of risk in case the builder fails to fulfill the contract.
By understanding the nuances of purchasing a new construction home, you can navigate the process with confidence and find the home that suits your needs and preferences.
Contact Sword Mortgage To Learn More About Your Options
Call (770) 757-5750 or complete our online form to speak with a loan expert at Sword Mortgage to get help navigating your options and find a loan that fits your needs today.
