What You Need to Know When Buying New Home Construction

Written by AHRN Team Updated on January 12, 2024

When you think about purchasing a new construction home, you may assume this type of property comes with fewer problems than sometimes found in a previously owned home. However, that’s not always the case.

Builders cutting corners and unexpected additional costs are just a couple of the issues homeowners face when buying a new construction home. Negotiating the cost of a new construction home also looks much different than negotiating for a previously owned property.

Knowing how to navigate the steps of buying a new construction property will ensure a smoother homebuying experience. Secure a home that aligns perfectly with your preferences, needs and budget with these new construction buying tips.

New Construction Real Estate Agent

Before you begin speaking to builders and looking at floor plans, you should secure a new construction real estate agent. When you first meet with builders, they will be extremely friendly and excited to help you out. Resist the temptation to blindly go with their services and meet with a new construction real estate agent before making any lasting decisions.

Not only can a new construction real estate agent educate you on what to expect, but they can go to bat for you when negotiating with builders. This will help you get the best possible deal on your dream home. Having a professional on your side who knows the ins and outs of the new construction process is in your best interests.

More Like This: Working with a real estate professional who has experience in helping military members and Veterans may be in your best interest. Review the benefits of working with a Military Relocation Professional to determine if working with an MRP would be helpful to your home search.

New Construction Model Home

When touring model homes, remember they are designed to showcase all of the bells and whistles that could possibly come with your custom house. Builders do this to feature their best work and to entice buyers to fall in love with these homes.

It is likely that everything that comes with a model home would be an upgrade from a basic plan, which can be quite costly. The shiny features you see may be a mix of styles the builders do not typically package together, making it even more likely for buyers to want the most expensive combinations.

Appliances, landscaping, decks, patios, etc., may not come with the completed house, so make sure you figure those into the purchase price. Have your agent procure an itemized list of common features and upgrades as well as their costs. This way, you can go into the viewing with an understanding of what comes with a plan and what is considered “extra.”

The bottom line is that you need to be clear on what exactly you will receive with new construction and what it will cost. Prices can fluctuate between the time you ask and the time you sign, so be sure to check the numbers again before you lock in a contract.

If you can’t agree with the builder on what you want, be prepared to walk away and keep looking for a home that has what you need at a reasonable price.

Expert Tip: If you absolutely must have an upgrade that’s pricey, find out how much it would cost to have an outside contractor purchase and install it after the close of escrow. You might be able to save quite a bit of money!

Working With a Home Builder

Do your research before choosing your builder. Look for reviews and double-check with an experienced real estate agent for recommendations. As with any business, you are likely to find some great reviews and some less-than-ideal testimonials.

This is normal. It’s helpful to focus on the overall big picture you gather from reviews and agent opinions. Focusing solely on 1-2 positive or negative testimonials won’t give you the overarching truth of how that individual builder conducts business.

Questions to Ask a New Construction Builder

When buying an unfinished home, you must spell out in writing what will happen throughout the building process. Review the following top questions to ask a new construction builder, and have a conversation with your realtor before speaking to the builder about what expectations you should have regarding their answers.

  • What is the estimated timeline for the project from beginning to end?
  • What will happen if construction is not completed in time?
  • What is the total cost of the entire project, including the indicated upgrades?
  • How do you obtain the proper construction permits, and how do you handle inspections and approvals from the city?
  • What is your process of handling any issues or problems with the home after construction is complete?

Your real estate agent may have more questions to add to the list above. Bringing your agent along when you’re speaking with your builder is often beneficial, as they can ask clarifying questions based on their experience and expertise.

New Construction Negotiation and Agreements

When you negotiate, you will find that it involves more bartering than bidding. The builder may not shift their price as an owner of an existing home would, but you can ask for a certain upgrade to be included in the cost they are quoting. You can also ask the builder to cover some of the closing costs associated with purchasing the new construction.

A real estate agent who is familiar with this kind of sale is going to be invaluable during the negotiation process. Ask your agent to get the builder’s warranty info early on in the and read it carefully. Then, incorporate any concerns you have into your offer documents. This will help address your worries from the get-go.

For example, builder delays can be frustrating and expensive for the buyer. Hotel and storage costs are just a few expenses that can add up if a builder does not complete a project on time. Spell out in your contract with the builder what will happen if there are delays. This will ensure you are not financially responsible for the consequences of an extended timeline.

New Construction Inspection

You should complete your own independent inspection with someone who does not have a relationship with the builder. Have the inspection done in two parts — before construction is completed and after the project is wrapped up.

Having an inspector look over the home before the project is 100% complete will make it easier for them to see potential problems. An inspection right after the project is completed will ensure that everything was done correctly and according to the agreed-upon specifications and standards.

Discover More Housing Resources With AHRN

Are you considering purchasing a previously owned home? Browse the large selection of homes near military installations at AHRN. You can also explore more military housing resources, where you can find expert-level advice, tips and guides regarding purchasing and renting a home.

Article written by


A part of the military's trusted source for off-base housing, our editorial team is here to share tips and tricks to moving, PCS, home loans, and renting for military families.

Your Trusted Source for

Military Housing and Rentals