For those looking to buy a home during or after the COVID-19 pandemic, new construction may be one of the best options. The U.S. Department of Homeland Security’s Cybersecurity and Infrastructure Security Administration has identified construction as essential and encourages state and local officials to allow for continued operations. Each state chooses if they want to allow construction to continue. Overall, it appears many states are supporting continued building, and housing starts are actually up from this time last year according to U.S. Census Bureau.
Buying a newly constructed home comes with many advantages and disadvantages, whether we're experiencing a pandemic or not. Be prepared to spend time with your real estate agent and builder to stay on top of changes to the construction timeline, preferred finishes, and inspections. Let's look at a few things you should be aware of when choosing new construction.
Advantages of Working with a Builder
If you're considering a newly constructed home, consult with a real estate agent who is a new construction specialist. This type of agent works with builders and knows the ins and outs of construction timelines, upgrades, downgrades, inspections, etc., all of which work in your favor.
You will end up using the builder's title company which makes in more efficient to get into the home. It's wise to work with the builder's lender too. You'll be able to close when the home is finished because it's guaranteed with their lender. The builder has great bargaining power with their lender, which benefits you as well. If you choose your own lender, the closing might be delayed -- something builders want to avoid because they pay fees as they wait and it's probably not ideal for you either.
You and your agent can attend meetings and inspections so you're always in the know. This is good way to review plans and learn more about the progress of your home and if it's meeting code requirements. Rest assured, builders know what they're doing and know how to handle inspections, deadline, issues, etc. If you have any concerns, you can always take pictures and discuss them with the builder afterwards. The inspector will sign off on all inspections before leaving the site.
Choosing the Finishes
In addition, new construction provides an opportunity to choose the finishing touches. For example, you may with to upgrade from laminate flooring to hardwood. You may want to upgrade to high-end appliances and fixtures which aren't included with the basic kitchen package. All of this is possible with new construction. Talk to your agent and builder early in the building process to make sure you get exactly what you want in your new home.
One disadvantage of new construction is getting an exact date for the end of construction. This is due to many variables beyond the control of the builder. Inspections and deliveries may be delayed and vandalism may occur. Your builder will work to make up time, when possible, to avoid lengthy delays which aren't favorable to either party.
Another disadvantage of new construction is ongoing construction around the home you've just moved into (another home could be under construction next door). In many cases, new construction involves a series of lots and phases of construction. For example, there's a new development in our neighborhood and after 3-4 homes were built everything came to a halt (Phase 1 completed). We enjoyed having new neighbors and less noise from construction. Within 4-5 months construction began again (Phase 2). Talk with your agent and builder to learn more about the different phases of construction in your area and make sure you're comfortable with noise and dust that comes with the territory.
When looking to purchase a home, consider new construction. A real estate agent who works closely with the builder is essential, and they will be able to provide updates as the home progresses. Due to the coronavirus pandemic, special precautions will have to be taken to insure you, the builder and your agent stay safe but in most cases new construction will continue through the crisis. Talk to an agent today to learn about newly constructed homes in your area and get ready to find a forever home.
Before you go, check out our in-depth home buying guide: