9 Pieces of Advice for Buying a New Construction Home

My husband and I bought a new construction home in 2012.  We were living in the city and decided we wanted a single family home, more space and a bigger yard.  We looked for houses and somewhere along the way stopped into a model home of a new construction community.  We were surprised to learn that having a brand new house built was not much more expensive (in some cases even cheaper) than buying a "used" house, so we started to give building from scratch some serious thought.  We looked into several different builders in our area and quickly discovered that Ryan Homes was one of the most affordable of the single family builders in our area.  Ryan Homes does not offer a lot of the custom features that other builders offer, but we knew we wanted to "customize" our home ourselves anyway, so we were ok with that.

We worked with an RH salesperson to look at several different models and price out options.  Then, once all our selections were made and our good faith deposit was paid, we were turned over to our project manager to begin construction.  The buying and building process was very overwhelming.  Neither my husband or I were first-time buyers, but building a house from scratch is an entirely different experience.  There are so many more decisions, trade-offs and potential to spend A LOT of money on upgrades.

Now that we have been in our house for almost two years, I wish we could do it all over again!  After living in our home, seeing what spaces we use most, and doing a lot of DIY projects, I have learned a ton!  In some instances I am glad we made the decisions we did, but others I wish we had done differently.  Obviously everyone is different, so my "lessons learned" may not apply to everyone, but here is my advice for anyone considering or in the process of buying a new construction home:

1. Ask for a price list of all of the upgrades offered for your model.  And ask for it early.  You will not believe how quickly your upgrades can add up and how little is included in the base price.  I promise you that about 90% of what you see in the model home is an upgrade... and is not cheap.  We went with very minimal upgrades and negotiated some things for free and still wound up spending about $25,000 over our base home price.  You don't want to get your heart set on a particular model only to find out you can't afford it when you add your "must have" upgrades.  

2. Splurge on structural, not cosmetic upgrades.  Almost all of the upgrades we chose were things we could not easily do down the road; a 4' extension on the family room, a few extra windows, master bedroom/bathroom luxury suite.  We passed on the things we knew we could either do ourselves or have a contractor do cheaper.  Things like flooring, crown molding, the deck, etc. were all things we knew we could do ourselves cheaper than Ryan's price.  We recently installed hardwood floors in our study.  The same exact flooring was almost exactly 1/2 the price of what the builder was charging.

3. Negotiate.  Most builders will tell you they don't negotiate, and they are all lying.  They may not budge on the base home price, but if they think you are really serious about buying, they will throw in some upgrades for free or at a discount.  Just make sure you do all of your negotiating before you give them any money.  Once they have you hooked, you can forget about getting anything else for free.

4. Consider lighting, especially on the first floor.  I wish we had gotten more recessed lights and/or rough-ins.  It's essentially impossible to add recessed lights on the first floor without tearing out your ceiling (unless you get really creative like John with his coffered ceiling).  If you don't like a ton of lamps in each room, think about splurging for the extra lighting package.  The second floor is a bit easier to add lighting later since you can access it from the attic.  That's what we plan to do for the upstairs bedrooms at some point.

5. Get a three car garage!  (If it's an option).  This is probably my biggest regret about our house.  This was one structural upgrade that we felt was superfluous at the time.  Both of our previous homes were in the city where we didn't even have a driveway, so we figured a two-car garage would be more than enough.  We were wrong.  I still cannot believe how often we use the garage and I think everyone has more "stuff" to store in their garage than they realize.  We added some storage under our deck and we are going to build a shed at some point, but it would be nice to have the extra garage space instead of adding another structure to our property.  A three-car garage is not cheap, but I would argue that it is worth the money.  (I would love to hear what someone with a three-car garage thinks about it).

6. Don't let the salesperson talk you into extras you don't need.  They love to tell you how that extra upgrade will only cost you $10.00 a month since you will be financing it in your mortgage.  But you're also paying interest on it for the term of your mortgage so you actually wind up paying more for it than the listed price.

7. Make sure you get the kitchen you want.  A kitchen renovation is one of most expensive things you can do to your house.  If you just have to have those butterscotch glazed painted cabinets, just do it... or it will cost you tens of thousands of dollars to rip out your existing cabinets and do it later.

8. Consider sunlight when choosing your lot.  We did not think about this, but it just so happened to work out for us.  Our family room and kitchen are in the back of the house, which is where the sun sets.  This is perfect for us because we both get home from work around 6:00, so we enjoy some natural sunlight in the evening.  And it makes for some romantic sunsets on our back deck :).

9. Be wary of lot premiums.  Some communities we looked at were charging up to $30,000 for lot premiums!!  In some cases every single lot had a premium, which still makes no sense to me.  I think it's false advertising to say that houses start at $200,000 when you need to pay at least $10,000 for the land to put the house on.  (Maybe that's just me).  As with the upgrades list, make sure you get the list of lot premiums for every lot in the community so you can make an informed decision.

I know a lot of readers have also recently built new-construction homes.  I would love for you to comment and share your lessons learned!