Buying Homes Pre-Construction

Lee Keadle
 


Visitors: 139

Many people hear about buying homes in the pre-construction phase of development and having the home value skyrocket in the first few years. The stories usually involve someone “getting in” during the early phases of development when the builders offer good incentives and competitive pricing. These homes can be great investments, but deals like these are harder to find now than they were even five years ago. So, talk to your real estate agent about pre-construction homes (and investing in the Charleston area in general) if this is something you are interested in.

A lot of our clients have opted to buy homes pre-construction because they need time to sell their current home. Building a new home in Charleston usually takes anywhere from four to nine months. We have found that new construction is the best way for people to go ahead and buy a home (reserving a price in the market) but also postpone their closing date (giving them time to sell their house). Along the same lines, most builders only require you to put down a small amount (anywhere from $1,000-15,000 depending on price of house) upfront. After you make this payment, you don’t usually pay any more until the house is built and you close on it. So, if you are still making mortgage payments on your current home, you don’t have to worry about making double mortgage payments until the time that your house sells. Also, if you are an investor, it would be beneficial for you to try to not close for a while so that you can capture the appreciation of the home.

Another benefit of buying homes pre-construction is that you know your home will be low maintenance. Builders are required by law to give specific minimum warranties to ensure that you don’t face any major problems during the first few years of living in your new home. One of the warranties is a minimum of 1-year “bumper to bumper” warranty which ensures that everything in the home is covered by the builder. There is also a 2-year warranty that covers all systems (electrical, plumbing, heating and air conditioning, etc. ) in the home. Another warranty is the 10-year structural warranty which covers foundation and other structural problems.

An obvious benefit of buying pre-construction homes is that you get to choose many features in your home. Depending on the progress of construction, you can often choose flooring, cabinetry, light and plumbing fixtures, etc. You can either go with the upgrades, or you can keep the standard features in order to keep costs down. If you are buying a home during the early phases of development, you can usually choose which floor plan you want to use and even which lot you want to build on.

Although there are plenty of benefits of buying new homes, there are also some drawbacks. New construction homes sometimes sit on smaller-sized lots compared to older homes. Older lot sizes in Charleston are typically about 1/3 of an acre, while newer lots are generally ¼ of an acre. These averages vary according to area, and you’ll find larger lots in general in areas that are farther out in Charleston. Another drawback of pre-construction homes is that you don’t have a definite closing date. Due to weather and building permits, the builders don’t always close on time. A third drawback is that people can’t always walk through the house and see how it looks before you buy. New construction neighborhoods almost always have a model home to show you examples of finishings and upgrades. Although these homes have different layouts and features, they can still give you an idea of the quality of work you can expect from the builder.

Lee Keadle is a full-time real estate agent in Charleston, SC. He works with a team of three agents to give buyers and sellers the best services possible. You can search for homes and vacant land on our website at http://www.SearchForCharlestonRealEstate.com

(691)

Article Source:


 
Rate this Article: 
 
Pre-Construction: How to Make Money in Real Estate Without Doing the Scrunch ..
Rated 4 / 5
based on 5 votes
ArticleSlash

Related Articles:

Tips for Buying Pre-Construction Homes in Charleston SC

by: Lee Keadle (June 05, 2007) 
(Real Estate)

Buying Pre Construction at The Bluffs on Cape Fear

by: Chris Robertson (March 04, 2007) 
(Real Estate)

Understanding Pre-Construction Investing

by: Yolanda Bishop (April 12, 2007) 
(Finance)

Sarasota Pre-Construction Real Estate

by: Jennifer Bailey (August 17, 2006) 
(Real Estate)

The Growth of Miami Pre-Construction Real Estate

by: Jron C. Magcale (July 20, 2008) 
(Real Estate)

Thinking Business With Miami Pre-Construction Real Estate

by: Jron C. Magcale (July 10, 2008) 
(Real Estate)

Pre Construction Investment Real Estate - Pros and Cons

by: Mark Goldberg (October 25, 2005) 
(Investing)

Pre-Construction Investment On High-End Miami Condos

by: Vanessa A. Doctor (February 20, 2008) 
(Real Estate/Condominiums)

Construction Loans for Homes

by: Sarah Freeland (December 13, 2006) 
(Real Estate)

Pre-Construction: How to Make Money in Real Estate Without Doing the Scrunch ..

by: Jeanette Joy Fisher (December 11, 2004) 
(Real Estate)