From limited lots to rising material costs to extended time frames, there are several factors that make new construction a challenge of its own in this real estate market. On the other hand, there is no concern with updating the home or meeting appraisal. So what is the best option? That answer is unique to each buyer and their particular wants and needs. This is why Leigh and Rob decided to have a chat about this and educate anyone that may be in dark here.
- Time Frame - Right now we are looking at anywhere from 9 to 12 months to build a home. There are some spec homes with entry level builders, but for the most it will be more than 9 months. So this is not the typical close and in 30 days you move in. This is going to be a planned process.
- Lack of choices - As these builders get super busy, they are offering less and less options. This happens when we see low inventory, and builders need to get houses up which is done more quickly with spec homes where the builder makes the choices.
- Contract Price Vs. Final Price - When you go into your build job, you are looking at their base price plus the lot and perhaps plus a few items you could change that were built into the base price. However, you may decide you want an extra outlet, more can lights or an extra gas outlet for your bbq. This type of item is what we call a change order will have an effect on the final price.
- Scarcity of lots - Obviously we are in a tight market so there are not too many lots available. So, with new construction you are tasked with finding a lot with a builder that you like, then finding out if a house that you like by that builder will fit on that lot. Now our choices are narrowed down a even farther. So you either find a lot you love and hope that you love the builder, or you can find a floor plan you love and hopefully they own a lot that you end up loving.
- Material Cost Rising - We just had a deal where the overall cost went up $18,000 for lumber! We know it is not typical for anyone to watch lumber trade, but these are things that effect builders and in turn effect you as the consumer. So, make sure that you are asking your agent to get that information for you so that you are able to make a decision with all of the facts. It is also crucial to get under contract as quickly as possible so that your price is set.
- No bidding war - You have heard it. People are currently buying homes for $50,000 and $60,000 and even higher over asking price. You are clear of that with a build job. It is very rare that you have another buyer interested until the home is built so it is good to get in before it is advanced in the building process.
- Appraisal will likely not be an issue - With prices rising, by the time a house is started and finished there should be no issue with appraisal unless you have gone crazy with upgrades or are perhaps out of now and there are fewer homes to comp.
- No remodel cost - Enjoy that sparkle unique to a new home!
We hope this can help buyers find the option best suited for them. If you or someone you know has questions on the Boise Area Real Estate Market, we are here to help and advice is always free!