prospective home buyers would like to take advantage of these amazing mortgage
interest rates available today, but are getting discouraged. With so
little inventory and a steady increase in the demand, how can buyers compete?
It is a common misconception that you need to be able to get approved for a
construction loan in order to build a brand-new home. If you have been
searching for a home, but unable to get your offer accepted, you may want to
consider working with one of the reputable builders in our area on a turnkey
home construction package.
It will be very important to work with a real estate broker who has area knowledge and is experienced with the process, as it varies from purchasing an already existing home. When you are interviewing REALTORS to work with be sure to ask them about projects they have closed on and what areas they are located in. Each builder provides a different package and may have their own agreement template you will have to use, so understanding the details and having individual anticipatory guidance will help both expedite and streamline the process.
What is possibly most appealing about turnkey new construction is the ability to make some limited customizations to the home. Many builders provide an allowance for appliances, lighting, flooring, countertops and sometimes more. Buyers usually shop in person or online at approved locations within the provided timeframe. On occasion a buyer does not want to be burdened with so many choices and decisions to make so they may request to use the builder’s selection for most of the finishes. An already existing or model home is sometimes available to view as similar to one to be built. This allows the prospective buyers an opportunity to observe the overall quality of construction and finishing.
A builder could require a non-refundable earnest money deposit ranging anywhere from $1,000-20% of the purchase price depending on your agreement, so having some reserves available for a down payment could be necessary. You can expect to have two appraisal inspection visits during the process and you can inquire with the municipality to learn what types of inspections are required during the building process with Code Enforcement. Have a conversation with your lender to find out what changes, if any, may occur in the event your mortgage interest rate lock expires due to delays due to COVID-19, labor or other things.
Ask questions in advance about private water supplies and what the builder will provide regarding air and water quality, which cannot be tested until the home is complete. Make certain that you fully understand the access (road and driveway) to the home and who has the right to use it as well as whose responsibility it is to maintain it and ask if there are any annual fees that are or will be associated with this.
Why continue to make bids on already existing homes when you can be making your plans for a brand new one?
Nicole Foster is a real estate Broker with Locations Real Estate Group specializing in residential new construction and a Windham resident. Follow her at facebook/sellingmaine.com or Instagram @207nicolefoster. <