Questions to ask a builder

[spunkarella]

Our realtor is setting up a meeting for us with a builder, to consider going the new construction route. 

We have a lot and floor plan in mind. According to the realtor, it is the builder's most popular plan. We toured the plan in a different neighborhood a couple of weeks ago and already know we would want a few changes. Also, we are on a strict budget and are concerned about going over budget if we build instead of buying resale. 

What questions should we be sure to ask in the initial meeting? 

I know we want to make sure he really can build this house for our budget. The house we toured was the same plan, different builder, nicer neighborhood (much larger more private lots), with the bonus room finished but it was $50k over our max budget. I guess I am skeptical that moving it to a different neighborhood and leaving the bonus room unfinished will really save us that much money. 

I really know nothing about building, so I am nervous about going this route. We have looked and looked at resale though and keep finding something wrong with every.single.house. If nothing else, we hope this meeting will give us a reality check to stop being so picky about the resale homes we are seeing. 

[char217]

I am new to this board as we just started the house buying process. I have owned before, but never built. I don't need to post now because your post was word for word the gist of what I was going to ask! I feel you, I am meeting tomorrow with my realtor and the builder and want to have a list of questions before I go in to the meeting.

[tarheels]

My cynical self says there's no way to build without going over budget.

I'd have all the changes you want made laid out and ask him to get you a quote for those. Also ask to see the upgrades list and what's on it - does his price include shiny brass fixtures and you have to pay extra for silver or bronze? Does the house come with kitchen appliances?

Depending on your local market, be forewarned that he may not need to work with you to come in under your budget, so he could just shrug his shoulders and suggest you go another route because he may have other buyers ready to go without as many constraints.

And yes, a different lot, a different neighborhood, and no bonus room can save $50k. See it all the time.

[escrow]

We just built brand new. The same plan, same builder goes for more than $80k more about 20 miles away in the same metropolitan area. So if you are looking in a less desirable area it is feasible that the price could be that much lower. However as a pp mentioned if there are plenty of interested buyers do not expect the builder to knock prices down. We were lucky and snagged one of the last lots with people waiting in case we fell through so we had ZERO wiggle room.

[sju]

Remember location is key. $50k would not be unheard of here. I am looking at a potential relocation and have been casually looking at real estate in the new city. I like one builder's floorplan a lot (dreaming-we would not be buying anytime soon). The price for the same floorplan varies so much it doubles depending on location, lot and schools.

I had a house (spec home) built in 2002. Like pp said, definitely ask for the list of upgrades. That was key in my decision. My builder included tiles, fireplace, nice lighting allowance and other items while other builders had those listed as upgrades for a very high price. Ask about materials used including the roof, insulation, equipment brands, warranties, etc.

[spunkarella]

Thanks for all the good advice!

[melodramatic26]

We are building new right now. For us, we sat down and put every detail and design change on paper. The dollar mounts were listed. When done, that was the price of the house, then we negotiated on that number just like a normal sale.

Where we (and others I'm sure) go over, is on the "upgrades and allowances". We had SS appliances, chrome fixtures, etc, in the price. We were given allowances on flooring, lighting, electrical and granite. Those were options that we chose from a vendor. There are standard and then upgraded levels on those. If you stay in your allowance for them, you won't go over.

But, we wanted better carpet and an upgraded tile. And more outlets/can lighting, and chose a few "statement" lighting features that put us over the allowances. Granite was spot on.

When we negotiated the sale price of the home, we did so with the expectation that we would need around a $5k buffer for overages.

It's been a great experience and having been through it, I think it's totally possible to stay in YOUR budget but know that going into negotiations at the beginning.

[stephm0188]

I do agree that location matters a lot. The base price for the new build we wanted in the school district we wanted was 220K. If we were willing to move less than two miles over to a different school district, the exact same house had a base price of 170K. Location can be everything.

[starlily]

Jun 20, 2013 9:27:16 GMT -5 sju said:

Remember location is key. $50k would not be unheard of here. I am looking at a potential relocation and have been casually looking at real estate in the new city. I like one builder's floorplan a lot (dreaming-we would not be buying anytime soon). The price for the same floorplan varies so much it doubles depending on location, lot and schools.

I had a house (spec home) built in 2002. Like pp said, definitely ask for the list of upgrades. That was key in my decision. My builder included tiles, fireplace, nice lighting allowance and other items while other builders had those listed as upgrades for a very high price. Ask about materials used including the roof, insulation, equipment brands, warranties, etc.

All of this. We recently bought new construction, but before we signed the sales contract we walked through our preferred model with a sales rep to determine exactly what was included by the builder and what was an upgrade. With that info in hand, plus the price list for upgrades, we were able to get a good estimate of total cost. We went over by $4k, but that was only because we decided to add some things we didn't initially plan on.

School district makes a huge difference in my area. The same builder was building literally across the street from us, but in a different school district. Those homes (same size, features, products, etc.) were easily at least $50k less than our side of the street.

[spunkarella]

char217 how did your meeting go?

[char217]

So sorry I am just now responding. I just saw this. The meeting went well! We went under contract June 30th. Hoping to break ground early next month. I'm a little overwhelmed, but excited!

[bunnymendelbaum]

Jun 20, 2013 21:44:36 GMT -5 @callmefia said:

Gah! I started a post and clicked away, then it was gone!

Some of the things that led me away from building (in addition to outrageous lot prices in pur area) were asking questions about stuff like:

Does the lot need cleared? Who is responsible for that? (As in, is this already included in the cost?)
What utilities need to be tapped into, from where, and who is responsible for that?
What landscaping is included - usually none.
Does the builder put in a driveway? (Some only do construction drives, then you have to put down gravel or pave)

This! Does the builder own the lot?

[treschic]

A little late for your question, but thought this might help:
- We removed a bonus room above the garage and I believe it saved about $20k. We switched that to finish the basement so I'm not exactly sure. The roof pitch can be different so I think that is part of the savings
- A few of the builders we had bid our house were $30k more than the builder we are going with, so this could be the difference in your new bid as well
- Agree with PP, switching from 2x4's to 2x6's was only $2k. It is always a good idea to ask the price difference for upgrades like that because hearing "it is more expensive" doesn't paint a clear picture. Upgrading to better siding was only $2k too. Of course that adds up, but $2k over the lifetime of the home is worth it