Oftentimes home buyers believe that purchasing a brand new, recently constructed house is better than purchasing one that has been lived in. Repair and maintenance costs should not be very high, appliances should be up to code and working, and the design and layout of the home will be more appealing to a home buyer with a modern sensibility. The problem is that newly constructed homes often times have hidden costs that home buyers are not expecting. We will discuss some of the most important hidden costs when buying a newly built home so that you do not get blindsided during the homebuying process.
Newly constructed homes are usually built to a certain standard, so they may not contain certain features you desire. Things like certain appliances, decks, fencing, window coverings, and landscaping may not be a part of the home, and could be features that you desire. This means that you will have to pay to have them included.
Because all of these missing items are an added expense, you may want to ask your realtor what is included in the total price of the home. If certain things are not included that you want, you should figure out what they will cost and factor them into the total cost of your new home.
When you tour a model of what the home being built will look like, you will usually see it with all the upgrades included. This means your expectation will be a home with all the extra upgrades included. Each upgrade could add a lot to the cost of your new home, and you may find that your “dream” home is too expensive and you can not have all of the features that you thought would be a part of your new home.
Expect to pay a price that will likely be tens of thousands of dollars higher than the list price of the base model if you want a home with all the upgrades included.
You may believe that because the house was just built it will not have defects, but this is not true. The materials used to build a home are new, and have not stood the test of time like they have in used homes. This means that within only a few years you might find yourself dealing with expensive defects. Heavy rain could reveal a poor waterproofing job, weak slabs in the foundation could crack, or electrical wiring may have been installed poorly and need fixing.
Because of these issues it is important to research the builder of your home, and make sure that their reputation and track record are solid and reliable.
A New Neighborhood
The new house you are purchasing may be part of a whole neighborhood of newly constructed homes. Because the whole neighborhood is new, you may be dealing with an uncertain future in your new community. You likely will not have the chance to meet your neighbors before you close on your home, and they could end up being bad. You will not know how reliable sources like trash collection and utility services will be. You may not yet know what will be built on vacant land close to your home. All of these things could have an impact on your home’s future resale value, and are very difficult to predict.