Want to Buy New Construction? Here is What You Need to Know


Want to Buy New Construction? Here is What You Need to Know


There are lots of perks to buying a new construction home. For one, everything is new! There's typically a full-year warranty on all mechanical systems: plumbing, electrical and HVAC with contact information for those vendors should you have any issues. Nearly all the materials used in your house will have their own separate warranty, such as roofing, siding, windows, and appliances. Houses built in 2019 also have 30% better energy efficiency than homes built just 6 or 7years ago. Crazy? Yes! Better for you? Absolutely. A more energy-efficient home equals lower bills and lower cost of ownership.

 First Thing's First: Representation- 

 This may be the most important thing you can do. I worked in new construction-sales teams for many years and I have seen how these guys operate. They will very commonly tell you that you don't need representation. Subdivision agents represent their seller, but they won't have your best interests in mind! Many people believe that you can get a better deal if you don't have an agent. I'm here to tell you that is not the case. This is especially true for production-home builders, Co-op agents are the lifeblood of home building companies and if they think that the builders are telling clients to fire their agents to get a better deal, these realtors will not bring them business. These on-site agents may tell you that they can get you a better deal and disguise incentives as price reductions. Those incentives were probably part of their deal regardless. Shady? Yes. Without having your own agent, you may not realize this. The realtor will do all the research needed to make sure you get every incentive possible and their fees are paid for by the builders. There is literally no reason not to use your own realtor.


Most new construction neighborhoods have a preferred lender; they refer people. Many times, they will tie their incentives to that preferred lender but it's very important that you get pre-qualified well before you hit the subdivision. Getting pre-qualified protects you in several different ways. When you have an understanding of what particular lending programs are available to you and what those fees are (along with payments you're able to make) put that up against the seller's lender and see if it's a better deal at all. They can be very difficult to get any incentives out of without using their lender. Your realtor can help negotiate the ins-and-outs of what's possible. Many times, if the loan program and fees they're offering can be higher than what you're already getting, the incentives may not even be worth it. Walking in with a pre-approval letter gives you more leverage with the builder and builder’s lender.

Types of New Construction Homes:

Production Built Houses

Production homes are defined as homes that are built with more speed and efficiency, with fewer choices for the buyers. Typically a slab house under 3,000 square feet can be built in about 90 days. Production houses are also limited in scope, and changes to floor plans and materials you can choose from. Many do a great job of giving you lots of choices to personalize your home. Production homes are typically in price points from under $100,000 to under $500,000. The higher the price point, the more selections and changes may be available to you.

Custom-Built Homes

With a custom-built home, the sky's the limit. You can find custom-built homes in many different price points, although they skew. They can tend to be a bit more expensive than a production home. You can pick your plan, elevations, and finishes; you can even make changes to the floor plan itself. In this process, construction times can vary greatly: a 4000 square-foot home with some minimal changes can only take about six months to build. Custom-built homes can be a daunting task for many people; buyers find themselves paralyzed by all of the decisions that need to be made. If you feel like you are not a decisive decision maker,  the custom home route may not be for you

New Subdivisions

When looking at new home construction subdivisions, there spec homes, also known as standing inventory homes. It’s one that the builder has made all the selections for and is marketed In the FMLS system.Typically in a home like this, you can close in about 45 days, so it's move-in ready (or very close to it!). Inventory homes can give you the most wiggle room in negotiations; the house is complete and the builder is now paying interest on his loans, so they are more apt to move it quickly.

Homes Under Construction

Homes under construction in a neighborhood can be a great choice because the seller has an understanding of how long before it can close.The buyer may still choose some of the selections, depending on how far into the build the house is. Typical closing times can vary, but it will be less than picking out a lot and starting from scratch.

Build from the Ground Up

 Building from the ground up is unique in that you may select the location of where you want your new house to be. Corner lots in cul-de-sacs are in higher demand, so there may be premium charges for selecting those. The biggest benefit would be that you get to select your plan, your color schemes, and all your personalizations. However, these homes will take the longest to close on, the upgrades can add up quickly, and affect the final sales price. Choosing to build from the ground up gives you the least amount of negotiation room if any at all. It's kind of like ordering your car from the factory direct; you're going to pay full price.

 Now.. Do Your Homework

Once you decide on the location or area you want to live in, have your agent/realtor pull all of the new home subdivisions and builders available in that area. In this market that is no small feat; home builders are selling houses so quickly that they get sold before they even get listed, so finding them can be very difficult. A realtor should know his or her market well enough to know where all the new construction is and what's coming. I have added myself to mailing lists of new construction builders in Atlanta to make sure I don't miss any! Once you have your list together, do your own homework on each builders reputation and their reviews. Homebuilders vary greatly in their processes. The Atlanta market is notorious for what is called “big box builders”, which follow tons of square footage with minimal upgrades. Whereas going to the other side of the spectrum, other companies put all the upgrades in and market those homes at those price points. At the end of the day, pricing levels out for the most part. By the time you add in all the upgrades to the big boxes, it may be cheaper just to buy a completely finished house with all the upgrades in it already.

Stick to your budget

Once you get your pre-approval letter and are comfortable with how much you want to invest in your new home, you may be looking for a house that is $30,000 less than your max budget, so you have room to do your upgrades. No matter what, make a budget so you will stick with it! It will be easy to get lost in all the shiny things builders can offer, and having to compromise can be a let down to a (mostly) very exciting process. Be prepared to give the builder cash for your upgrades. They're customizing a home specifically for you and should the deal not close (for a myriad of reasons), they have to protect themselves against remarketing that house or making changes back to original specifications.


This one is big for me. I make sure to have this conversation with every client that wants to buy new construction. Building a new home is very stressful; it can be a roller coaster full of both excitement and disaster. Your experienced realtor can help you manage the ups and downs and can be there to tell you what's normal. They also are the buffer between you and the builder when something is not normal. An example I always give is about windows: early in my career (when I was sitting on site for a builder at least twice a week), I would have one of my buyers come into my office yelling and screaming about a broken window.  I always had the same response. I would smile and say “There is only one? Don't worry, there will be more.” See? Easy.

Get a home inspection

I used to hear people say this all the time: “I don't need a home inspection! The house is new and the city's inspecting it, right?” Wrong! Houses are built by humans and not machines. As skilled as a tradesman maybe, some things are often missed. The city and county inspectors miss stuff...the quality control-people miss stuff...your home inspector can miss stuff too! The more eyes you can put on your house, the better. Private inspectors work for you and the information they give you is for you to take back to the builder and ask questions with. Best case scenario, they find nothing to report. Regardless, at least you have complete peace of mind! During the new construction process, you're allowed to have more than one inspection. I've seen foundation inspections, pre-drywall inspections...all of the inspections. If you really only want to pay for one, I recommend foundation inspection. This is done just before the builder covers the walls with sheetrock; it's an opportunity for the inspector to look at all the framing, wiring, ductwork, and plumbing before it's all covered up. Mechanical trades can accidentally damage the structural integrity of the framing, so the time to catch it is before everything is covered up. 

If you have any other questions about New Production or Custom-built homes or inspections, please don’t hesitate to reach out! Contact me directly at 678-229-8689. Thank you for reading! Be sure to let me know your thoughts and if there are any questions you may have. 

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