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Buying New Construction? 7 Things to Ask Your Builder First

[Updated: Jul 30, 2020 ] May 08, 2020 by Maurie Backman
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There are plenty of good reasons to buy new construction -- the chance to design your own house, score modern home features, and enjoy the feeling of being the first owner to occupy your living space. But before you move forward with a contract on a new-construction home, make sure your builder is able to provide answers to these important questions.

1. How long will construction take?

This is one question you need to ask when buying new construction, but take the answer with a grain of salt. Weather issues, permit holdups, inspection delays, and other matters outside your builder's control can delay the construction process substantially, so when your builder gives you an estimated closing date, make sure it accounts for these and other hiccups.

2. What's included in my home's purchase price?

Buyers of new construction are often shocked to learn that certain items aren't included in the cost of their home, like closet shelving, towel racks, and even cabinet hardware. Get a list of what comes with your home purchase and what doesn't so you know what to expect and how many extras to budget for.

3. Will I be credited for supplying my own fixtures or materials?

The materials used to construct your new home will likely be builder-grade, which means low-end and, in some cases, downright cheap. As such, you may want to upgrade certain items during the construction process -- for example, by providing your own kitchen sink faucet or bathroom tile. Find out if you'll get credited financially for providing those items. Your builder should be willing to give you some money back, or trade for a no-cost upgrade, if you're sparing him or her the cost of the items you're supplying.

4. Will you landscape the property?

Landscaping is something that's not always included in new construction, or included the way you expect it to be. Ask your builder what to anticipate with regard to your home. Will trees be planted? What about grass and shrubs? Landscaping can be quite expensive, so if you're going to be stuck doing a lot of it, it really helps to know that upfront.

5. How much extra could I get stuck paying?

New-construction homes often come with an escalation clause that allows your builder to pass the cost of unexpected expenses, like higher material costs, on to you. Find out if your contract has one, and if so, what that clause entails. And don't hesitate to negotiate that figure downward. Generally speaking, you should try to avoid a contract with an escalation clause in excess of 10%.

6. Is my property part of an HOA?

New-construction homes are often made available as part of developments that are governed by a homeowners association, or HOA. HOAs can be very restrictive, imposing rules that impact your daily life and exterior design choices, so find out if you'll be subject to one -- and the fees that come with it.

7. What type of warranty will you provide?

It's common practice for new-construction homes to come with a warranty that protects you from certain repairs in the first year or two after you've closed on that property. Find out what sort of warranty you're looking at, and what the process is for filing claims against it should that become necessary.

The last thing you want to do is sink money into a new-construction home and end up disappointed after the fact. Be sure to talk through any concerns you might have with your builder before signing a contract so you'll wind up happy with both your decision and the final product.

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