With low inventory in real estate markets across the country, many people are considering new construction. Although the process can seem overwhelming from start to finish, working with the right people and knowing what to expect can make the entire process less daunting.
Keep reading for what you need to know about the home building process before getting started.
Secure Your Financing First
Most homebuyers use financing when purchasing a home, and the same goes for new construction. If you were previously searching for an existing home and are approved for a mortgage, that won’t carry over to new construction.
Speak with your lender about obtaining a new construction loan. Like mortgage loans, new construction loans are easier to get if you have a strong credit history. This loan will enable you to pay your contractor as the work is being finished. Once the home is completed, the loan is converted to a mortgage.
Who You Work with Matters
Once you know you have appropriate financing for new construction, look for a builder who meets your needs. Research and meet with prospective builders to learn more about their style, quality of work, and rates.
Take the time to learn about the builder’s developments, warranties, reputation, and communication style. You will also want to learn how the builder handles permits and hiring for specific jobs. A builder who understands your vision and communicates throughout every step of the process will ease stress and give you confidence in completing your new home.
Plan, Plan, Plan
After getting approved for a loan and selecting a contractor, the planning begins! With your builder, you can start to focus on planning your dream home. You’ll discuss the larger picture, including:
- Style of the home
- Number of bedrooms
- Number of bathrooms
- Storage needs
- Outdoor space
As you review the type of home you want, your contractor will share a projected timeline and completion date. In addition to planning what your new home will look like, be sure to plan where you will live during construction, as well as a backup plan in case the completion date needs an extension.
Purchase Your Lot
Some new construction takes place in a new development, where the builder owns several lots. In this case, during your planning phase you will select an available lot where your new home will be constructed. If you are not building in an established development, you will need to start looking for land for sale in your desired location. Once you have acquired land, your contractor will clear the lot before construction begins.
You Get to Choose
The final stages of construction are often the most fun. As you oversee the building process, you’ll discuss what you want to see in the design’s finishing touches. This includes selecting:
- Paint color
- Light fixtures
- Custom options
Throughout the entire process, stay in communication with your builder to stay updated on the timeline, build, and budget.