Building a New Home

If you've never built a new home before, the prospect of building one can seem daunting and full of so many unknowns. However, it’s also a big adventure to embark upon and requires much thought and preparation. If you’re hoping for the home of your dreams, there are a few things to consider before beginning the journey:

Decide what kind of new home you want to buy

Do you want to move into a new home this month? Or are you looking to build a home based on your specific needs?

For the former, you'll want to look for a "spec" or "inventory" home. These residences offer you all the benefits of living in a new home, but the initial design and building processes have already been determined for you.

For a custom home, you could hire an architect or building designer to help you design your home and draw the plans, then contact several different builders to bid on the construction. You might also be able to order a set of house plans online, and hire a residential designer to customize a few details. Make sure they comply with your local building codes.

Another approach would be to find a builder willing to build his floor plan on your lot, or look for a Design/Build contractor to do the whole project from design through to construction.

Decide on a Builder

Begin by selecting a builder who specializes in the type of home you want to buy. Make sure they have experience in the area you want to build, and that they have a history of building quality homes.

Other important questions to consider: When are they available to begin your project? Do they offer a comprehensive warranty? Are they financially stable? If you live in an area that is experiencing a housing development boom, ask about the amount of time the builder can spend with you throughout construction of your home if you have questions. Does the builder use his own crews or subcontract everything out? How are change orders handled-do you have to pay for changes as soon as you order them or are they added on the final price of the home? Take the time to check their references and talk to past customers.

With so many types of home building companies out there, it’s a little tough to figure out who does what and who builds what. Here’s a quick run-down on how to tell the difference between custom and production home building companies.

Production home builders generally:

• Build on land they own.
• Tend to use stock plans, but usually offer a variety of plan choices and options.
• Build all types of housing — single-family, condos, town houses, and rental properties.
• Are large-volume builders (those that build more than 25 homes a year).
• Generally build for all price points — entry level, move up, luxury, etc.

Custom home builders generally:

• Build on land you own. Some custom builders also build on land they own.
• Build one-of-a-kind houses. A custom home is a site-specific home built from a unique set of plans for a specific client. Some custom builders may offer design/build services.
• Build single-family homes.
• Are generally small-volume builders (those that build 25 or fewer homes a year).
• Tend to build high-end homes.

Select a Lot

Choosing a home site is as much a matter of personal preference as is choosing an architectural style or a floor plan. A nature lover might be captivated by a sloping lot with a boggy pond that would be unsuitable for a family with small children. A homeowner with limited mobility might want an absolutely flat property, while a family with teenagers may just need enough flat space for a basketball net.

As with any decision about building your new home, there are a few things to consider:

• Do you want to live close to your work, good schools, restaurants or shopping?
• Is the area served by public utilities or will you need to have a well drilled?
• What kind of restrictions does the neighborhood have in terms of architecture? Will your plans need to be reviewed by a committee first?

Within many communities, you can choose the location of your lot. The community may also include clubhouses, pools, golf courses, sports activity centers and other amenities, so you'll want to be sure to get information on the entire community, as well as the proximity of the available lots to these amenities. Typically, lots located close to such attractions as golf courses, clubhouses or lakes maintain a higher re-sale value.

The Topography of the Lot

A sloped lot offers the possibility of walkout lower levels, interesting decking and lovely views. Nature lovers often find great appeal in a living room deck at treetop level. Homes built on lots sloping to the back often appear quite small from the street, offering a delightful surprise as visitors come upon living spaces that expand to the rear and lower levels of the home. Lots sloping to the front offer an impressive setting for a house.

Flat lots are often the choice for growing families who want space to accommodate basketball courts, skateboarding and soccer nets. A retiree might prefer a flat home site with no stairs between the garage and house. Special features such as a swimming pool, stable and paddock, or tennis court require large, flat, well-drained areas and must meet specific zoning requirements.

Select your Floor Plan and Options

The floor plan, or how the rooms are arranged, is the most important aspect of the livability of a house. Insulation or central air or another bathroom can always be added, but if the basic floor plan doesn't meet your needs, you won't enjoy the house as much as you should. Here's a checklist to help remember what to consider when evaluating a floor plan.

The overall floor plan:

• Are the living and sleeping areas separate and clearly defined?
• Can someone move from one room to another without moving through the middle of any room?
• Is the kitchen adjacent to the dining room and other rooms in which meals might be served?
• Is there direct access to the kitchen from the garage or back door?
• Is there sufficient wall space for large pieces of furniture, such as beds, dressers, china closet and seating?

Lifestyle

• Do you want the master bedroom on the first floor or second floor?
• Does the floor plan lend itself to the kind of entertaining you prefer?
• Is the dining room large enough for holiday celebrations or dinner parties?
• Is the powder room convenient for guests and children coming in and out?
• Are the laundry facilities conveniently located?
• Can children's activities be supervised from the kitchen?
• Do you want a separate bedroom/bath suite for a nanny, aging parent or older child?
• Is the kitchen large enough for everyone's needs?
• Is the kitchen laid out so work can be done efficiently?

Storage
Every household has a good deal of stuff that needs to be stored. Is there a place to put:

• Towels and sheets and other upstairs items
• Vacuum cleaner and cleaning supplies
• Out of season clothes
• Books
• Canned goods and dry food products
• Sports equipment such as bicycles, skateboards, golf clubs, athletic headgear
• Household tools such as a hammer, electric drill, screws and nails.
• Garden tools and hoses
• Outside furniture and toys

Once you have the exterior and interior look determined, ask about extras. If you want vaulted ceilings in the living room, would the builder include them for an extra fee or are you limited to the options they offer? Do you want a gourmet kitchen? Could you add extra cabinets? Roll-out shelves? Do you have any special electrical, heating, or air conditioning needs? Will the builder install basic landscaping (for example, sod)? And a question to ask that is just as important as whether the builder can accommodate your request is, can you afford these extras?

Make two lists: “Absolute Musts” and “Wouldn't It Be Nice.” This will give you the best idea of which options your budget must include and which options you may have to reconsider.

Secure Financing

Determine how much you want to borrow, at what rate, and for how long. Some people like to develop several house plans and get cost projections for each one of them – keep in mind though that this is probably the most difficult method. The easier method is to determine how much you can afford to spend and then go forward with your plans based on your budget.

Another good way to roughly figure the cost is to visit model homes in the area that interests you so you can get an idea of what you’re looking at. Barbara Wilson and her team of professionals are always a good resource for neighborhood ballpark figures.

Once the right location and the right builder have been selected, it is appropriate to go to contract. Most builders require anywhere from 10% to 25% down in order to start a home. If the home is up and standing, the builder will accept 10%. If a custom home is to be created specifically for the purchaser, the builder would then expect a 25% deposit at contract.

Finalize sales contract

The time it takes to build the home increases with the size and the number of custom features selected. Realistically, a home delivery date range, if started from scratch with an improved road to the home site, can take anywhere from 120 days to 18 months. Remember the builder is anxious to keep the home delivery schedule on time. The builder does not get paid until closing.

The sales contract will specify, to varying degrees, the dimensions and features of the proposed home, site plan, materials to be used, and delivery date. Reading and understanding all the documents may seem daunting, however, you won't be doing this alone. Our knowledgeable team will be there to help you through each step of the process. Don't hesitate to ask questions.