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Buying new construction? 5 costly mistakes to avoid – Bankrate.com

Home shoppers can’t help but feel the heat these days, with the inventory of existing homes hitting an all-time low in late 2021. That limited inventory, coupled with high demand, has sent home prices soaring. If you can’t find…….

Home shoppers can’t help but feel the heat these days, with the inventory of existing homes hitting an all-time low in late 2021. That limited inventory, coupled with high demand, has sent home prices soaring. If you can’t find a suitable resale or you just want to start fresh, new construction can be an appealing option.

Brand-new homes offer enhanced energy efficiency, amenities and layouts more suited to modern lifestyles, plus the potential to customize spaces that you don’t get with a resale. But if you’re not careful, costs and expectations can spiral out of control.

The good news is that following these tips for buying new-construction homes can save you money — and hassle. Here are five costly mistakes to avoid when buying a new house.

1. Don’t assume you can’t negotiate with the builder

The top myth buyers of new-construction homes tend to believe is that builders won’t negotiate with them on price. But that’s just not true, says Kerron Stokes, a Realtor with the Resource Group at RE/MAX Leaders in the Denver metro area.

“You can negotiate price, lot lines, loan fees and other items,” Stokes says. “A builder may initially say no, but keep pressing. If you don’t ask, you don’t know the answer.”

Hiring a real estate agent who specializes in new construction can give you extra confidence in negotiating with builders. Also, hiring an agent costs you nothing as a buyer; builders typically pay the agent’s commission from their marketing budgets, Stokes says.

2. Make sure to budget for items not included by the builder

New builds are blank slates. For instance, many new homes don’t come with landscaped yards; you get that big-ticket honor after you move in. And if you buy in a development that has a homeowners association, you might have a limited window to put down grass or plant trees, which can cost thousands of dollars.

Read your contract and the HOA rules carefully, so you can anticipate and budget for these expenses as early as possible. Nothing rains on a new homeowner’s parade like getting a scolding HOA letter pointing out something you failed to do. Even if your home won’t be finished for months or more, get estimates for the items you’ll need to pay for and put money aside specifically for those projects.

Note that new homes often don’t come with basics like window coverings, toilet paper holders and towel racks or even light fixtures sometimes. Clarify what is and isn’t standard with your new home so there are no surprises once you move …….

Source: https://www.bankrate.com/real-estate/buying-new-construction-avoid-these-mistakes/

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