Most people are pretty clear on how buying a resale property works. You shop around, attend a few open houses, make an offer, and then hope the sellers accept it. There may be a few rounds of counter-offers and negotiations, but overall, it’s a pretty cut-and-dry process.
New construction, though? That’s where homebuyers get held up.
From timing and negotiating to vendors, home warranties, and upgrades, just about every aspect of the new home process trips buyers up — especially if they’re first-timers.
Want to make sure you’re educating potential buyers on the topics they’re concerned about most? Here are the top eight questions new home buyers have about the process:
1. How do I pick a home builder?
Every builder has its own unique floor plans, communities, upgrades and, most importantly, reputation. Make sure you’re telling (and showing) potential buyers just what sets you apart from the pack. Are your homes LEED-certified? Are you the top-rated builder in the city? Have you been around the longest? Differentiate yourself and make your unique value known at every turn.
2. Are new home prices set in stone?
Most buyers aren’t aware that they can negotiate the price on their new home. They also typically don’t know about incentives or other promos you might be offering, so make sure to advertise these clearly on your website and on social media, and instruct your salespeople to walk them through potential deals and discounts they might be eligible for.
3. Do I have to use the builder’s mortgage lender?
Many buyers assume they have to use your in-house lender (or whichever lender you’ve partnered with) in order to buy your homes. Though using a builder’s lender often comes with valuable discounts (hello, completely covered closing costs!), if buyers have another lender they’d prefer to work with, they’re always welcome to. Just communicate the promotions they’ll no longer be eligible if they decide to go out-of-house.
4. Do I have to build my home from scratch?
Not all buyers are familiar with “spec” or “inventory” homes. In fact, a good chunk probably think you either have to build a home from scratch or you can’t buy a new home at all. It’s important that your salespeople (as well as your marketing materials) cover the new build process (and timeline), as well as the spec homes you have in the works and available right now. Let them know that buyers at all stages are welcome.
5. Do I need to a real estate agent to buy new construction?
Most builders prefer buyers come sans agent, as it means fewer commissions out of pocket. If this is your preference, make it known — and clearly communicate what the benefits of working directly with you are. Will they get a lower price? More closing costs covered? You should also be sure buyers know they can always use or consult a real estate agent if they need to (or just want to.) First-time buyers, in particular, seem to be more comfortable buying with an agent — even if it’s a brand new home.
6. What if my home’s not done on time?
This is a big one and it’s a common concern with buyers who need to be out of their current home (maybe their lease is expiring) or into their new property (a new school or job is starting) by a certain time. When meeting with new buyers, make sure to address these concerns and cover any protections that are in place should their home get off schedule. Set expectations regarding weather delays, etc., and map out their options if timing goes off course.
7. What if something goes wrong?
Always discuss your warranties when meeting with or marketing to potential buyers. These set on-edge buyers’ minds at ease — especially ones who are putting a lot of cash on the line. You should also let buyers know that they’re always allowed to consult a home inspector if they’d like. Some home inspectors even offer construction inspections, which help ensure all the foundation, framing, and important systems are installed properly before the home is completed.
8. How long does it take to build a new home?
Buyers interested in building from scratch will always want to know the general timeline. Will it take six weeks? 10 months? Be clear and set reasonable expectations. Make sure they know that weather affects the entire process, as well as the role your manufacturers, vendors, contractors, etc. will all play. Talk through the larger construction process and don’t offer up any deadlines you’re not confident you can meet.
Want Help Educating Your Buyers?
Buyers need a little hand-holding when it comes to new construction, and we’re here to help. Our loan specialists can assist your buyers not just in understanding the overall construction process, but how it impacts their closing, financing, and move-in dates as well. Contact Embrace Home Loans to connect with one of our loan officers today.