A Smart Way to Buy a New Home

By
Real Estate Agent with DomainRealty.com LLC BK3275810

Southwest Florida has been a highly preferred destination for retirees and second-home buyers for more than 50 years. Now younger generations are also moving to Southwest Florida to enjoy its natural beauty, unparalleled waterways, excellent weather, established infrastructure, fine shopping, abundant recreational facilities, college and professional sports venues, many fine restaurants and excellent schools. All of this has resulted in a very active real estate market including new residential construction.


Currently about a third of Southwest Florida home purchases are new construction.

Some of the reasons why these buyers chose to buy new include the following:
1. New homes meet current regulations and building codes. These requirements represent the latest standards to improve quality of life including safety.
2. Most builders offer a long list of options from which to make choices. You can choose to go bare-bones to purchasing every option offered or choose in between as most people do.
3. Expect to pay more for a new home compared to a similar resale. However, modern materials last longer and new homes normally come with warranties, some as long as 10 years. Furthermore, builder incentives can offset the price difference. Besides purchase cost, life cycle costs should be considered also.
4. There are a variety of locations and community themes available to suit your lifestyle. Some offer no amenities while others offer virtually every amenity you can imagine.
5. Design styles in favor today like open floor plans and split bedrooms are normally not found in homes that have been in existence for a while.  In addition, opulent kitchens and baths are not only found today in high-end homes but are offered in mid-priced homes as well.
6. New homes are much more energy efficient than homes built even 15-20 years ago.
7. New homes have low maintenance exteriors including roofing, siding, windows, trim and railings. This leaves more time and money to do the things you really enjoy doing.
8. Builders often have mortgage money with attractive terms lined up for their home buyers. 

New construction, however, comes with challenges. Here are a few that seem to bother some home buyers:
1. New homes are not built in a day! Once the site is prepared and construction begins it can take another six months before closing escrow and moving in. However, buying a near-complete inventory home and customizing it, if  desired, can speed up the move-in period considerably.
2. New homes are often in new subdivisions that lack a
mature landscape look, often found three-five years later.
3. You may not have an opportunity to know if your neighbors' lifestyles will make life unpleasant or intolerable for you. In established neighborhoods you can always ask-around and determine if you and your neighbors will be a good fit.
4. Builders typically will not lower their price. If they did it would hurt their brand, especially if later buyers were given price reductions. However, many builders will give you price reductions on upgrades and perhaps provide other incentives depending on market conditions.
5. Build-out can take years. Be prepared for noise and dirt.  

6. You may be limited by subdivision rules. This can restrict any exterior changes you may want to make to your home and land.
7. Smaller lots may prevail in some new subdivisions. Years ago larger building lots were more common since land was less scarce in many locations. 


If you highly value the pros and can live with the cons, then new construction is most likely a good fit for you. So, how do you go about getting a good deal? First, some facts.
Builders estimate and update their costs on a regular basis to adjust their pricing. Part of their cost structure includes estimates for marketing. Part of the marketing budget includes expected costs for finding a buyer.

Most builders will sell directly to a walk-in buyer or will pay a commission to an outside brokerage for bringing them a buyer. In the case of a walk-in buyer the cost to sell directly is usually less than the budgeted amount. In this case the saved difference supplements the builder's target profit. However, if an outside agent brings the buyer, the builder must compensate the outside brokerage which in turn pays their agent a commission split. The usual result for this scenario is that the entire marketing budget is or is nearly debited to acquire a buyer from a third party source.

In the first case the walk-in buyer without representation pays for service they never receive whereas in the second situation the buyer gets representation for which they have paid. Therefore, every buyer should use a third party qualified licensed agent to help them get a good deal. It doesn't cost anymore to do so. So why not take advantage of what you have paid for anyway. Always remember that the builder's agent, no matter how friendly and accommodating, represents the builder and not you, the buyer.

Here's what I can do to help you find and buy your Southwest Florida home at a good price:

  • Help you secure financing with attractive terms, if needed
  • Provide you with a detailed checklist to help you finalize your new home requirements
  • Provide you with a link that currently identifies new Southwest Florida construction communities and builders
  • Help you choose the best community that suits your needs plus one or two backups
  • Help you vet your fist choice community in terms of environmental impact, expected insurance premiums, declarations, restrictions and rules
  • Obtain a complete and full understanding of the new buyer process, purchase agreement, construction process, closing process, customer service, the warranty process and home maintenance required to keep your home in tip-top condition  
  • Review the options list with you and help you make sensible choices
  • Help you negotiate a final total acceptable sales price including possible free upgrades and incentives
  • Monitor construction and provide you with periodic updates
  • Provide you with free home related consultation services for as long as you own the home
Remember, your builder indirectly makes this service available to you at no additional cost to you. Again, you will pay for it anyway, so why not use it! However, pay serious attention to the following: 

     CAUTION.......CAUTION.......CAUTION.......CAUTION.......CAUTION.......CAUTION.......CAUTION
IF YOU DECIDE TO USE A THIRD PARTY RESOURCE SUCH AS ME TO HELP YOU BUY YOUR NEW HOME, DO NOT CONTACT THE BUILDER IN ANY WAY; EVEN TO ORDER A BROCHURE, MAKE AN EMAIL INQUIRY OR PHONE THE BUILDER. IF YOU DO THE BUILDER WILL DECLARE THEMSELVES AS THE PROCURING CAUSE OF THE TRANSACTION AND THE BUILDER WILL NOT BE OBLIGATED TO COMPENSATE THE CO-OPERATING BROKERAGE AND YOU WILL LOSE THE ASSISTANCE. THE ONLY WAY TO ENSURE THAT YOU WILL GET THE ASSISTANCE YOU DESERVE IS TO BRING YOUR AGENT WITH YOU ON YOUR FIRST VISIT TO THE BUILDER. 

If you have any questions about new construction representation or want the link to explore South Florida's new construction market you are most welcome to contact me at
239-450-7178 or jilaw@aol.com.


  



  

 




  


 

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Rainmaker
1,591,601
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty - Kalispell, MT
The House Kat

This is a good overview of new construction and the process to purchase with representation. Best wishes getting calls from buyers!

Jan 17, 2017 03:33 AM #1
Rainmaker
180,993
James (Jim) Lawson, DBA
DomainRealty.com LLC - Bonita Springs, FL
Broker Associate, RSPS, BPOR, HI & PE

Thanks Kat. Too bad many new construction buyers are not aware of or choose not to take advantage of representation. 

Jan 17, 2017 07:51 AM #2
Rainmaker
4,384,109
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

James, great post, and many buyers absolutely love brand new homes.   Nice for you to remind Buyers they do need representation, as the sales reps are very helpful, but work for the Builder.

Feb 26, 2017 05:45 AM #3
Rainmaker
4,798,831
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Good morning Jim.  Some great information for new home buyers.  Thanks.

Apr 19, 2017 04:30 AM #4
Rainmaker
180,993
James (Jim) Lawson, DBA
DomainRealty.com LLC - Bonita Springs, FL
Broker Associate, RSPS, BPOR, HI & PE

Thanks Gabe. Now if we could only get new construction buyers to follow their self-interest and seek representation.

Apr 19, 2017 09:51 AM #5
Rainmaker
2,183,893
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

I've been so blessed to have two home that were new construction. If I could, I would only buy new. Love that new house smell! LOL

Oct 24, 2017 05:50 AM #6
Rainmaker
180,993
James (Jim) Lawson, DBA
DomainRealty.com LLC - Bonita Springs, FL
Broker Associate, RSPS, BPOR, HI & PE

I like new better too Sharon. Nothing lke making my own dirt.

Oct 28, 2017 01:08 PM #7
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Rainmaker
180,993

James (Jim) Lawson, DBA

Broker Associate, RSPS, BPOR, HI & PE
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