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5 Points to Think About If You’re Buying New Construction

Friday, March 9, 2018   /   by Bret Johnson

5 Points to Think About If You’re Buying New Construction


Today’s topic comes from my experience last weekend showing new home construction to an out-of-state buyer. From that, I came up with a list of five things you need to know when buying new home construction.


1. New homes aren’t always listed on the MLS.
Builders really just build on their own schedule. They’ll pull lots when they have the available sources and funds, and therefore, they don’t always do their marketing the traditional way. It’s very important that you either work with a knowledgeable agent or get access to some proprietary information in order to have access to properties that are coming on the market or to beat out other buyers to the best deals when the builders release their lots

2. New homes are often sold before they’re built. Understand that builders build on their own timeline, and once the lots are released, they have a limited supply of inventory in order to continue to build out a phase. Therefore, they’ll oftentimes sell them before they’re even built, not necessarily in a spec situation as a new home, and then you’d have an opportunity to buy the lot and build at that point. Not everything can be done on a schedule that aligns with your needs.

3. The first buyers into the subdivision get the best discounts. Many times, they’ll run incentives to kick off a phase, and then as they open up new phases, they’ll typically increase the price—especially in a good market. It’s important to get there fast, but also to work with an agent so as to get priority access to the deals before they get released.

4. Builders don’t have a personal attachment to these properties. Everything is done based on the numbers. It’s important to start your search out with your ducks in a row to make sure you have the strongest pre-qualification you can to present to the builder. You should also understand that, while negotiations may sometimes be limited, if you come prepared, you can come in and make an offer to these builders. As long as it aligns with their time, there is room for negotiation if you play it smart.

5. Builders want to keep the values in their subdivisions strong. Often, if they’re going to negotiate, they’ll do so on upgrades as opposed to price. If they lower the price, that will show up in public records as a lower sale, which will irritate previous buyers that paid more for that same model. Instead, they might throw in an appliance package or some kind of an upgrade package whereby you get the value in that and they don’t love the value of their sales prices in the community.


If you’re looking to buy a new home, understand that working with a knowledgeable agent gives you the ability to have full buyer representation, and it doesn’t typically cost you anything. We as a team can represent you, help you negotiate, and make sure you’re getting access to priority on deals whereby you can get the best opportunity and beat out other buyers.

If you have any questions, feel free to reach out to me.