Top 10 Ways to Save Money When Building a Home

What’s up, guys? Building a home can be a fun process. When you think about all the cool designs and neat toys and different features that you can put in at times, you can get really carried away in a dream world of expensive, customizable options for your dream home. But the reality is that building a home does cost some money. And to be able to build your dream home, you’re going to have to pinch pennies, especially now that material costs have gone through the roof. So this video is all about making those pennies go as far as it possibly can. And it starts now. I’m Jonathan. This is my baby mama, Rachel. And these are the top ten penny pinching ideas to make sure that your custom home doesn’t cost an arm or a leg and maybe a kidney when you’re all done.

Usually if you use a lender that they’re comfortable with or credits that their design center towards particular upgrades or things that they might be able to get at a discount or at their cost. So number one, the easiest way to get an incentive is to use the builder’s preferred lender that’s number one rule. Builders want you to use their trusted lender so they know that your preapproval is good. They have a working relationship with a lender, and it’s a big deal too, especially if the builders taking out the loan. Some cases these builders are taking out 700, $800 million loan on behalf of someone else to build them a house. So they want to make sure that when you show up the closing your loan is good, just like anything else, it never hurts to get a second quote. So you may want to get in contact with another reputable lender just to make sure you’re getting sort of the best loan options that you can, but make sure that you’re considering all the benefits of using the builder’s lender.

Number two, check the builders warranty. Is there one? Actually, in the state of Virginia, builders are required to do a one year home warranty in a five year structural warranty. But some builders go above and beyond that. So make sure you know what their building warranty actually covers for you. Knowing exactly what is covered under the warranty will really help you down the road. Sometimes I’ve had people call me and say, Hey, I need this grout touched up well, a lot of builders will come back and touch up your grout, but they kind of want the house to go through all of the seasons. So they want the house to expand and contract and be in the cold and hot. Some builders will only actually do touch ups or warranty issues like nail pops or grout touch ups or paint touch ups one time.

will also cover things like the big systems and everything even far beyond their one or two year warranty. So those are really good things to ask for. So you know exactly what’s covered. Yeah, it’s also good to have representation.

Number three, find a home builder that has standing inventory. It’s going to be a huge help to you. Many builders start home and then hope to be able to sell them before they’re completed. These are called spec homes or speculative builds. If the house makes it all the way to completion without being sold, the builder might be a little bit motivated to sell and often they’ll be more willing to negotiate. Also, sometimes a buyer’s unable to close or they cancel. Their financing could fall through. Life change could happen. So sometimes those homes have to be resold on the open market. So yes, sometimes these homes are often upgraded to a point. It can be crazy upgrades and it might not be your taste of choice or it might just be sick things that the builder just has to get off of his books and he’s ready to dole out a deal. at were once previously sold, they came back on the market or that he spec built and just didn’t sell in the timeframe that he thought he should. We have experience working with builders, actually working with buyers, and going to a builder where the builder one times buyers to come up with a low price, only find out that they’re everything that they would want in the home would have to be upgraded so that they can have. You know, who you are.

Number six. Here’s kind of like an hidden rule of the trade, especially with large builders who have shareholders. So like publicly beazer homes, these kind of places that have public shareholders, they’re accountable to shareholders and they have like reports that they have to run at the end of the year. So you may be able to get a discount on a new home towards the end of a year. If a builder has a bunch of inventory sitting around that they need to sell out before we close out of that calendar year. Now, this may not be the case in a like hard core seller’s market, but in a normal balanced market, you can see some really significant decreases at the end of a quarter or at the end of the year, particularly in December, when everybody’s focused on Christmas and holiday shopping. It’s a great time to try and snag a new construction home at a bit of a discount because the builders trying to get it off his books.

And number seven also has a lot to do with timing. For instance, when a builder first releases a community, that’s actually a great time because their prices are going to be at their lowest. As a builder sells homes in a community their prices increase over time. Obviously, poor market conditions could bring a price down, but normally, especially now, those prices increase as the builder continues to build phase after phase after phase. So look out for those neighborhoods that are coming soon. You might be able to get the best pricing.

Numero Ocho, order a home inspection. Look, not all builders are created equal, and not all builders are good builders. That’s just the freaking truth. And don’t rely only on city inspections to make sure that your home is built to the standard that you will need it to be built to. If you have two destructive children like I do, that might tear it down. No, I’m kidding. But get a home inspection. We go back and forth on this one. I typically land on getting a home inspection, even if your builder won’t allow it to be a contingency of sale. Get a home inspection to protect yourself. And so that you know of any there might even be items that the builder doesn’t have to fix because it doesn’t break building code, but you might want to know about it.

So in most cases, in most situations, I would say go ahead and get the home inspection. Do yourself the solid if you begin to feel some concerns with the builder in their quality, you certainly want to get a home inspection. Be a great time to order it, or if nothing else, just if you need to keep yourself at ease and need the peace of mind. So if you do decide to hire a home inspector, make sure you contact the builder. Don’t do this like willy nilly on your own. This is something the builder needs to know about his representations will need to be on site. And if there are going to be things that you need to negotiate or make corrections with, normally most builders are not going to have a problem with this.

They just don’t want you to slow their process down. So by and large, builders are going to want to make sure because they have to warranty you. They want to make sure that the home is built very well. So it shouldn’t be too big of an issue. Just make sure you go through the proper channels to clear it with the builder.

Number nine, you really should have representation when working with a builder and here’s why. Most builders aren’t going to give you a discount for not having a real estate agent working with you. They already have this kind of baked into their numbers. So there are really expecting to pay for a realtor to be representing you, and they might give you a small discount, but it’s not going to be anything like 3% like you would think because that’s just not how they work. Most builders don’t even pay 3% to to the realtors anyway. So it kind of a case by case basis, you really should have representation when you’re working with the builder because the builder really is a business and he’s working for himself. He wants the home to be beautiful for you and not every builder is the same. Some builders are like a little bit shady out there, and some builders that we’ve worked with are amazing. And honestly, you might not even need a realtor, but it’s always in your best interest to have someone represent you.

Yeah, number ten is we would love the opportunity to work with you so we can throw all the stats at you. We’re very experienced. We’re in the top two to 3% in Hampton Roads year upon year. We’ve done this a million times, but the reality is, this is our area of passion and our specific niche. New construction is very unique, just like there are certain fields in, say, medicine or law, like new construction. There is a lot that goes into it specifically on the outside.