Top 10 Tips for NEW Home Buyers
Before you purchase that new home to call Home Sweet Home, Read our Top 10 tips for NEW home buyers.
- Location, Location, Location – The lot you select will impact the home’s future resale value. In Spring Texas, the characteristics of your lot becomes even more crucial since there are No Zoning Laws. If vacant land is viewable from the lot, you want to find out if the land has been platted to be part of the Spring Texas subdivision. If it is not part of the subdivision, anything can be built on it (Walmart, apartments, grocery or convenience store). Homes that back to commercial properties, busy roads, cell phone towers, or water storage tanks all negatively impact the home’s resale value.
- Get the best loan for your needs – Builders often offer monetary incentives for you to use their preferred lender. The builder’s lender is not motivated to offer you the best interest rate and terms, because they believe they have a captive audience (You). Get GFE’s from other lenders and make the builder’s lender work for your business.
- Get an Independent Inspection – The builder will tell you that there is no need for you to get your own inspection. They are already having the house inspected by an independent third party inspector. Who’s interest is this independent third party inspector watching out for? Not Yours. The builder is paying the independent third party inspector. The builder receives the inspector’s report. Not You. Hire your own independent inspector. The average cost will be $500. Its a small price to pay for piece of mind on your largest financial investment.
- Who’s watching out for YOU – Not the builder. The builder is watching out for the builder. Sure they want to make you happy, but in the end the builder has his best interests at heart and not yours. Get a Spring Texas Realtor to represent You in the purchase of your New Home. The builder has already included the cost to pay the Realtor to represent you in his marketing costs. It is not going to cost you more to have a Realtor represent you. But it could cost you more in the long run if you DON’T have a Realtor represent you. A Realtor will help you make the right decisions to positively impact the future resale value of your home.
- Taxes, Taxes, and unfortunately more Taxes – New subdivisions typically have higher tax rates than older subdivisions. Remember that the current tax bill is significantly lower than what it will be in the future. The current tax bill is based on the value of the lot ONLY and not the home and the lot. You do not want to be surprised when that first tax bill arrives. Remember to include property taxes in your cost of home ownership.
- Get top dollar for your existing home – The builder has an interest in you selling your existing home. Sometimes the builder has an allegiance with a Realtor. This is not always good for you. You need to choose a Realtor whose goal is to get you the best price for your home and not their builder allegiance.
- Upgrades …. Which ones are worth the money?– A general rule of thumb is that upgrades that would require tearing up the structure if you waited to do them later will cost you less during the initial construction. As an example upgrading your fluorescent lighting to recessed can lighting would be worth the money. Builder upgrades of window treatments and sprinkler systems care not worth the money. They can be installed after you close usually for 50% of the price that the builder quoted you. Keep in mind during your decision of upgrade or not to upgrade that the neighborhood should support your upgrades.
- What to look for during the final walk-thru– Be PICKY! A house is never perfect. But this is your one chance to get it as close to perfect as possible. Don’t be in a hurry to close. The builder wants to make you happy so that you will close on the home. Take your time and carefully inspect every room in the house. Look for snags in the carpet, uneven paint application, cracks around windows and door frames, uneven wall texture, holes in the walls, paint on the light fixtures and door handles, squeaks in the sub-floor, proper centering of light fixtures, and smooth operation of doors and locks.
- What does the future hold for the home’s resale value? – Subdivision location, school districts, lot characteristics, subdivision amenities, floor plan, the home’s amenities, and tax rate all impact your home’s future resale value. Ask for the opinion of someone who resales homes for a living before making your final decision.
- The closing statement – Is it correct?– Compare the good faith estimate (GFE) you received from your lender to the figures on the HUD1. The figures should be very close to one another. Watch out for the survey and Owner’s Title Policy (OTP) cost. These are two large costs that are typically considered the builder’s cost. Your contract with the builder should state which party is responsible for these costs.
On average a person buys a home every seven years. It just makes logical sense to have someone represent you on this large financial transaction. Especially a task that you do so infrequently. Why take an unnecessary risk? We represent buyers day in and day out and we would love to help you in the purchase of a new home. The builder pays us to represent you. So why wouldn’t you want someone watching out for you?