iowahomeloans

Buying a House Before it is Built

Posted on: August 12, 2013

Buying a house before it’s built, during the pre-construction phase, can save you anywhere from 20 to 30 percent versus an established home. Unfortunately, buying early also carries some risks and things to consider. Is the cost savings worth enough to you to live with these factors for the next few years of your life?

 

Be Prepared for Uncertainty about When You’ll Actually Have the House

If you’re buying very early – when the development is still a sea of mud and a sales trailer – it may be more than a year before you get to move into your new home. Construction delays and delivery snags are extremely common for new home developments – even more so if you buy early in the process during the pre-construction phase.

 

If you buy early, you need to be prepared to live with the uncertainty of when you’ll actually get to move into your home. Have flexible living arrangements, and make sure you can stay longer than you think you might in order to accommodate any delays. If you absolutely have to be into a house by a certain day, buying new construction – particularly before it’s built – may not be the right choice for you.

 

Know Your Builder

When you’re buying pre-construction, it’s vital to know your builder. Choose a builder that has done similar construction before – and has completed those projects. Generally, you don’t want a developer who has historically done shopping malls and is now making a first foray into residential development. You should visit other communities your builder has finished, and talk to their residents, if possible, to ensure that people are satisfied with their homes and communities. It’s all too common for a builder to disappear, mid-project, leaving unfinished roads, half-built homes and unlandscaped yards.

 

Will You Feel Comfortable Living Virtually Alone?

If you’re buying very early, you’ll probably be living in the community before it’s established. Will you feel comfortable living virtually alone until more people move in? Are you comfortable with the safety factor? Will your kids have a place to play, or will the community be a mass of construction materials and machinery for years to come? Make sure you’re ok with living in a community with few other residents while the community is being developed, or consider buying in an established area.

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