Buyers Archives - Page 16 of 16 - Fort Collins Homes

6 Tips To Buying A New Construction Home

Buying a new construction home is a bit different than purchasing a resale home — one that’s been previously owned by someone else. You’ll need to be familiar with a few tricks of the trade, along with understanding a bit about how the process works.

1. Use your own Broker/Agent.

ALWAYS use your own RE/MAX Advanced Broker/Agent; doing so will help ensure that you get what you want. Understand that the sales reps you meet at new construction communities are likely representatives of the Seller — the builder, corporate owners, developers, whomever — they are there to present their product, answer your questions … and do the best job for the Seller.

2. Don’t expect price reductions.

Yes, it does happen. But overall, remember that builders have established a set of prices that they feel best make their product (the houses) marketable with an expected profit margin. Furthermore, lowering the price on a house drops the comparable value of other houses in the community, thus bringing the entire suite of houses down in price.

3. Look instead for builder concessions in the form of additional upgrades.

Rather than price reductions, you may be able to gain a few upgrades from the builder at no cost, or for less money. Perhaps the builder would be willing to include a fence, landscaping, upgraded carpeting, or appliances as part of your purchase without charging you extra.

4. Builder incentives in the form of interest rates, etc., may not be coming from the builder.

Lots of new communities boast incentive programs that cite things like “3.75% financing for 30 years” or “Zero Closing Costs.” What’s important to know is that the builder may not be the one actually paying those closing costs, or reducing the interest rates. Typically, those types of incentives are coming from the builder’s preferred lender who is counting on a sufficient number of loan transactions in order to recoup the cost of the incentives.

5. Expect to use the builder contract or addendum.

In almost every case, new construction homes require the use of a builder’s contract or at least a lengthy addendum in addition to the typical purchase forms used by a Broker/Agent. Generally builder forms include language specific to the terms of the building process and can be many pages long, full of tightly packed terms. While much of the language is common sense, be sure to read the contract thoroughly yourself (as will your Broker/Agent) and then consult with a qualified real estate attorney if you have questions or concerns. Agents, even those sales reps for the seller, aren’t allowed to (and shouldn’t) attempt to advise you or interpret what those custom forms really say.

6. Builder warranties vary.

Not all builder warranties are the same. Some builders warrant their work from top to bottom for several years, some only for one. Many builders will offer a warranty of up to about 10 years for structural-type issues, with other warranty time frames for things like plumbing leaks. In addition, you’ll find that your new home will likely
have individual warranties for appliances, roofs, windows, etc. Be sure to carefully review the warranty offered by the builder of your desired home before signing the final contract for your new home purchase.

Looking For More Information?

Take a look at our Pinterest Board – House Hunting Tips
https://www.pinterest.com/remaxadvanced/house-hunting-tips/

Or check out some other links:

http://www.hgtv.com/design/real-estate/how-to-buy-in-new-construction

https://www.redfin.com/blog/2014/08/10_tips_for_buying_new_construction.html#.VdO3hflVhHw

7 Answers to the Question:
Why Is Housing Inventory So Low?

7 Reasons Why Housing Inventory is Low

There has been a great deal of discussion but little written explanation regarding the low housing inventory level. Many factors are contributing to rising prices and limited inventory
in many markets.

1. Capital gains exclusion on primary residence:

The Taxpayer Relief Act of 1997 allows homeowners to take a $250,000 (for singles) or a $500,000 (for married couples) capital gains/appreciation exclusion. When gains exceed the $250K/$500K maximum, higher priced real estate markets experience an unintended outcome: fewer move-up buyers thereby reducing available home supply to new entrants

2. Step-up in basis:

A surviving spouse can sell a marital residence and possibly owe only federal capital gains
tax on the property’s appreciation, reducing the tax consequence of the sale. Married homeowners in higher-priced homes may wait for one spouse to pass away before a move is made, keeping thousands of properties off the market until some point
down the road.

3. Sustained low-rate environment:

Many homeowners and investors have either purchased or refinanced with historically low interest rates and are unlikely to sell these homes as a result of this favorable financing.

4. Market value discounts:

Between 2007 and 2010, many buyers purchased properties in markets that offered significant price discounts. Institutional investors entered the residential real estate market acquiring large pools of properties. Combined with low interest rates, these properties are not likely to be sold anytime soon.

5. Values not at peak levels across the country:

Home values in some regions across the U.S. are still below the historical highs of the mid-
2000s. Until these prices return to peak levels, these homeowners are unlikely to sell.

6. Move up:

If a homeowner cannot find a property to move up to, they will not sell their current home.
Similarly, retirees finding limited options for retirement communities are not motivated to sell unless they know exactly where they are going.

7. Stunted new development:

Since early 2008, there has been an unparalleled low level of new home development. The start-to-finish build cycle is lengthy, often requiring years to plan, approve, build and market. Until new housing development accelerates, new home inventory will remain limited. Given the factors above, nationwide inventory will likely remain low for an extended period of time and the natural solution remains unknown.

Source: Chris Trapani co-founder Sereno

Questions to Ask Your Home Inspector

When you buy a Fort Collins home, you need to know exactly what you’re buying. Imagine how frustrated you’d be to find out that the hot water heater wasn’t working—in the middle of a shower! This is why you should have a home inspection before you buy your home. A home inspection is an important part of buying your home.

Before you hire a home inspector, ask candidates these questions to make sure you hire a trustworthy inspector.

1. What does your inspection cover? Not all inspections are the same. Ask for copies of previous home inspections so you can see exactly what they will check inside the home. If you are concerned about something specific, like a leaky faucet in the bathroom, mention that to the inspector so they can check it out.

2. Are you licensed or certified? If you live in a state that licenses home inspectors, ask to see their license. At the very least, choose a home inspector who belongs to American Society of Home Inspectors. This shows a level of professionalism and education that you can trust.

3. What kind of report will you give me? You should expect a written report detailing what the inspector found. Most inspectors will give you a typed report within a week of the inspection. Make sure the inspector will be available to explain anything on the report that doesn’t make sense to you.

4. Will I be able to attend the inspection? If the inspector refuses to let you be present during the home inspection, find someone else. This is your chance to know exactly what you are buying and what potential repairs you or the seller will have to make.

Your RE/MAX Advanced real estate agent, will guide you through the home buying process and can refer you to a trustworthy home inspector.

Let us help you find your new Northern Colorado home. Call us today at 970-221-5995 or email us at homes@ftcollinshomes.com if you would like a referral to a reputable home inspector or if you are thinking about buying a home.

LINKS:
American Society of Home Inspectors. – http://www.ashi.org/
5 Easy household repairs. – http://home.howstuffworks.com/home-improvement/repair/5-home-repairs-you-should-do-yourself.htm

By MySmartBlog in Partnership with BreakthroughBroker.com