New home construction in Orange County has accelerated in the past 12 to 18 months and that means there soon will be many more options available for home buyers. While buying a freshly constructed home certainly has lots of advantages, there are also some additional things you will need to deal with if opting for that route.
First Team Real Estate, which buys and sells more homes in Southern California than any other brokerage firm, recently spelled out some of what you will need to do if buying a brand new house.
Here are the seven steps they list when buying a newly-constructed home:
- Get a buyer’s agent
- Scope out your choices
- Submit an offer and sign a sales contract
- Apply for a mortgage loan
- Customize your home
- Get an inspection
- Sign the closing documents
While the majority of these steps are necessary when buying any house, a couple are unique to the purchase of a newly-constructed home. We’ll focus on those here.
The two that really stand out are “scope out your choices” and “customize your home.” As for the former, there are an array of options when it comes to new home construction in Orange County. With the housing market back from the depths of the last downturn, more developers are breaking ground on new projects. So what you want to do is first narrow your choices to a select few communities and then delve in to find all the information you can on each.
For each community you zero-in on, First Team Real Estate suggests you compare warranties, prices and contracts. Then, weigh all the pluses and minuses of each factor n order to determine what community is best for you. Furthermore, you will want to research the builders for that community to ensure they have a solid track record.
Next comes the fun part of new construction and that’s the ability to customize your house. You can personalize your new home as much or as little as you want—but note that the more you customize the higher the price. Note that builders will typically be all for plenty of customization. That’s because the more upgrades the higher the profit margin for the builder, according to First Team.
Given that fact, you will want to decide which custom projects you really want and those you can live without. Sometimes there are even custom projects you can add yourself at a later date at a much cheaper price than what the builder will do.
One more thing when it comes to customization—you need to make sure all your upgrades will be approved by the lender. Sometimes a lender will not finance certain upgrades and therefore you will have to pay out of pocket.