How to Simplify
Building Your New Home
Mackenzie believe’s that everyone deserves at least one brand new home in their lifetime. She also understands that purchasing and building a new home is a big decision, a decision that some may think is overwhelming. After assisting with the construction of over 200 new homes she decided she needed to create a way to help simplify the process of purchasing and building a new home. With the steps below and her assistance by your side as you explore, find, purchase and build your new home, she will take what many say is a time consuming and stressful process, and make it as streamlined and stress-free as possible.
Over the last 7 years Mackenzie has been involved in the construction of over 200 new homes; professionally helping others build their dream homes to building 4 personal new homes. Having sold more new construction in Charlottesville than anyone else from 2012 to 2016, she became the #1 Builder Sales Representative and one of the top New Home Experts in the Charlottesville area. She decided that she needed to share her knowledge and expertise with all new home buyers. That’s when she left her career working directly for builders, to became a Realtor with a focus on representing homebuyers needing assistance finding and building their dream homes.
From many years of working for builders and building her own homes, she understands the complexities of new construction. Having a broad knowledge of the new construction world, starting with all the contract paperwork, construction materials, building codes, builder’s pricing structures, to the multi-stage construction process, she will be able to make your new home purchase easier. She can walk you through the building process step by step stress-free by providing helpful advice on design, selections, cost, home siting and so on. Throughout your purchase, she will also be able to answer your many questions throughout the build to save you time and hassle.
Items to keep in mind, are understanding what you can afford for your deposit, loan amount, different development costs, closing fees, and any other expenses that are required. This will help determine what size home you can build and what finishes you can select. If not paying cash for your new home, then you will need a deposit saved for your loan. In addition, you will need some of this money upfront as builders have different requirements for deposits to start construction. These deposits are typically higher than a resale home and can range from 3-20% of the price of the home. The deposit you will give the builder is held in escrow during construction and at the end goes towards your loan downpayment.
A fixed price contract is typically the best choice when building and is more common with medium to large size builders. If you and your builder don’t have one in place, you must budget for some fluctuations from the original price quoted. Not to forget, any changes to your design or selections you make throughout the build will typically include extra cost. There is always the potential when building that you could add as little at $250 to possibly $100k to the original price if you select a lot of additional upgrades. This is why it is important to keep this in mind when comparing the prices of different designs and selections from different builders.
If not paying cash for your new home and you’re getting a loan, then meeting with a reputable lender, in the beginning, is the best idea. This way you can receive a pre-approval to know how much you can afford going forward with your home search and build.
If not familiar with what a pre-approval is, it is when the lender verifies a borrower’s information and documentation to determine exactly how much the lender would be willing to lend to that borrower. The documents to get pre-approved are the same documents that you would need to get a mortgage.
-Last 2 years’ W-2s
-Last 2 federal returns
-2 months’ of bank statements of all types of accounts
-Your credit report
Deciding if the City or the Suburbs or Rural areas are for you?
Choosing a certain location for your new home will influence many aspects of your everyday routine. If you choose the city over a rural area you should expect more noise and movement around your new home. Where if you choose a rural area, you may hardly ever see your neighbors. The location you choose for your new home will also affect how large your homesite can be, what education options you have, vicinity to everyday conveniences, and walkability (if any) to your favorite spots.
Is a particular community or area important to you?
You may know exactly what new community or area you want to live in, but most homebuyers will need to research their options for where they want to build. While they discover these communities, areas and their options, they will find that every community will have different characteristics that may or may not fit their needs. When comparing your different options, make sure to take into account:
-How close you want to be to work?
-What proximity do you want to be to family and friends?
-If you have children, how far are the schools from your house or work?
-Does this community have the amenities you want for your everyday lifestyle?
-Are you close enough to your favorite hobbies or leisure activities?
After reviewing these factors with Mackenzie, you will be able to narrow down what is important to you and explore the locations that best satisfy your needs. Being a Charlottesville native and a new home expert, Mackenzie can help you identify what areas or communities currently marketed and even unmarketed to the public may work for you.
– Know your needs- How much space do you need? What style home? Location? How much can you afford to spend?
– Experience- What is the builders experience? How many homes have they built? How many years have they been building?
– Tour builders model homes or customer homes-You can’t miss this step ever. You need to see the homes a home builder is offering in person and what type of workmanship they have.
– Floorplans and Style of Building- Do you like the home plans the builder offers? Does the builder style of building fit your needs? Are you able to make the changes you need to, to build the home you want?
– Quality- What type of materials, workmanship and building practices is the builder using? You can notice most of these items when touring the builder’s homes. Ask for a list of what brands and included features are standard in their homes.
– Visit a home under construction- Seeing a home that the builder has under construction, can tell you a lot of a builder. Is the site clean? Does the job site seem orderly? What can you see behind the walls of the home under construction?
– Meet the project manager- Try to meet the person who will be in charge of building your new home. See if this project manager can walk with you through a home under construction, this way they can answer any questions you have and you can see how knowledgeable they are.
– Home warranties and service- How do the different warranties for each builder compare? Does the builder have the procedures or staff in place to service your home if you need them in the future after moving in?
– Referrals and Reviews- What are the past homebuyers saying about this builder? It never hurts to ask the builder if they could refer some past buyers of theirs to speak with you and hear about their experience.
– Future Worth of Your New Home- Do the builder’s past homes hold or increase in their value over time?
Most builders have their own contracts and terms. Builder contracts are similar to most contract terms and sometimes can negotiate some of the terms. That said, most builders can only have a certain degree of flexibility when negotiating as there are items that are out of their control and some may be taking a lot more risk if they are financing the build. For example, a builder will hardly ever be able to promise a 100% fixed delivery date, as weather or the unforeseen “acts of god” could always delay construction. Most experienced builders do figure in some extra time into their build schedules just in case something arises that could be a delay.
The builder’s contract is typically a little longer in documentation length than a contract to purchase a resale. This is due to the builder using diagrams, renderings or selection lists to confirm how your home will be built. From Mackenzie’s experience, the more diagrams and over-communicated explanations of what a home buyer will receive in their new home can never be enough. Building a new home can be a complex process with several steps and extra documentation along the way will only ensure nothing is missed.
What selections to make at contract?- The large selections to focus on at contract or right after you have signed the contract, are the structural options in the home. Some examples: the 4 ft great room extension, 3 car garage, extra full bath in the basement, moving a door or maybe finishing the basement. The main reason to focus on these structural options first is they are typically the most expensive options you will pay for in your new home and they are harder to change after you have started construction. Mackenzie recommends choosing the structural must-haves you really need and can not live without first. She believes that choosing your must-have structural options over something like expensive lighting fixtures or marble countertops is a better decision for resale. Because the next homeowner may not be able to add these large features in the future if not added with the original build or it may cost them a lot to change later. If a certain finish doesn’t fit in your budget after selecting your structural options, and you can wait to have it in your new home, then consider changing out a countertop, upgrading appliances or adding some lighting after you close. These are not hard modifications to complete later.
Remember Step 2, Establish your budget?- Review your budget before selecting your finishes and additional upgrades. The budget that you have prepared should help the selection process go smoother. Most builders will have some idea of cost or even a detailed pricing list for the upgrades and selections you want to make. This way, you can compare or research what makes the most sense in your new home. Try to focus when you visit the design center or showrooms, as upgrades could quickly add up as you become distracted if you aren’t conscious of what things cost or what you budgeted to spend. During your selections meetings you will pick out cabinets, countertops, appliances, flooring, exterior colors, stone or brick color, and so on. Trying to avoid overspending during these meetings, consider reviewing your budget before you have these meetings. Mackenzie will happily attend all your selection meetings to provide her insight and ideas if you need them. She has assisted with selections for many different style homes and a wide range of price points from a $200k townhomes to million dollar homes.
Try not to get carried away with customizations in your new home- One of the benefits of building a new home is you can make changes to the layout and overall finishes of your home, to express yourself and make the home more livable for yourself. But you will want to make sure not to over-customize your new home, for the main reason being the resale value. If this is your last home ever and you know you will be there for the rest of your life, then you may have some more freedom to do what you want, but most will end up needing to move again and have to sell their home. With that said, try to consider if the changes you are making are too out of the box or too bold for most homebuyers. For example, selecting purple tile over purple paint might be a risk you don’t want to take. It is easier to change a paint color than changing out tile.
Phase 1- Pre-Construction Meeting- Before construction of your new home, it is customary for you and your builder to sit down to review your plans, selections and building timelines. This way, you both can double check that you’re on the same page before the start of construction of your new home.
Phase 2- Groundbreaking and Site Work- Your builder will stake your home on the lot and prepare to dig for a basement or grade for a slab/crawl space foundation.
Phase 3- Foundation- Once excavation is complete, your builder will pour the footers for your foundation’s stability. Next, the walls are poured or blocked for the cement walls of your home’s foundation.
Phase 4- Framing and Roof- This phase is really when you can start to see things start to take shape. After the framing phase is complete only about one-third of the construction process is complete.
Phase 5- Rough Mechanicals- Rough mechanicals are referring to the heating, air conditioning, plumbing and electric components to be installed in your new home.
Phase 6- Drywall- Prior to your drywall is to be installed your builder may perform a pre-drywall walkthrough with you. This is a great time to see what is behind your new home’s walls. If you are considering having a home inspection, this would be a great time to have this inspection done.
Phase 7- Finishes- This phase is definitely one of the most exciting phases. You will get to see all of your selections you made come together.
Phase 8- Final grading and Landscaping- Now your lot will be final graded, seeded or sodded and landscaped.
Phase 9- Final Inspection and Completion- During this phase, a final quality punch out is completed to fix any small imperfections and adjustments that can be found. Your home will be professionally cleaned and this is your final chance to have a home inspection to do a final inspection your new home and share their report. Most Builders will perform a Final Walk-through or New Home Orientation before closing, to help better orient you with your new home before you move in. At this point your home is complete, your closing is set!