New Construction Guide

As the housing market continues to rebound, new construction homes are becoming more and more popular. New construction means that there is no need for costly renovations so you can move in immediately and enjoy your new home from day one! As a prospective buyer of a newly constructed home, this guide will help you navigate through each step of the process with confidence. Ready to buy? Let's get started!

What is a New Construction Home? 

A new construction home is a newly built house that has not been lived in. These homes are often sold as-is, but there are builders who offer financing options.

New construction homes may seem like the more expensive option upfront, but they are actually a great investment, particularly if this is going to be your forever home. You can also purchase eco-friendly appliances that will help you save big on utilities over the years. You can save you a lot of money in down payment fees, closing costs, renovations, plus mortgage interest in comparison to other forms of housing options.

New Construction Home

What Types of New Construction Homes are Available? 

If you’re considering purchasing a new construction home, you have several different options to consider. Here are a few ways you can invest in this amazing real estate opportunity: 

1. New Home Construction - This is where a contractor builds a completely new structure from scratch using plans and blueprints previously set by an architect or engineer. Usually this type of builder works for only one company and has a network of subcontractors they use to build homes. Depending on the builder, they might have their own real estate agent or they might work with an independent realtor who is not affiliated with them directly.

2. Remodel or Addition - This type of home construction involves renovating or remodeling a structure that previously existed before the current owner purchased it. The entire building can be renovated or just several rooms can be added onto for additional space. This option is great as it allows you to live in the house while you are upgrading it so there is no time wasted moving into a new place after all your work is done. A word of caution though, make sure to get estimates from several different contractors and check their references to make sure the quality of work they do is up to your standards.

3. Renovation or a Fixer Upper - These types of homes are often listed as "fixer-uppers" or "great opportunity" in real estate listings. Usually these types of homes are older without many upgrades that need to be done when compared with remodels where both old and new construction materials can be used. These houses are great if you have good skills in carpentry, plumbing, masonry and home repair because you will likely be doing much of the repair work yourself. Keep in mind this option also has a higher risk for extra problems not discovered by your inspector if one is hired since most work will have already been completed before your purchase.

Fixer Upper

4. Open Plots of Land - This option is usually only available in rural areas where a lot of land has already been cleared for building and empty lots are made available to buyers. There are several advantages to purchasing land with the intention of building your own home as you can build it exactly how you want. If you decide to go this route, make sure that the lot will be approved by an engineer or architect by checking with local zoning laws. Also factor in costs for engineering fees, permits and more when budgeting so you know exactly how much money will need to be allocated for initial construction before even buying anything else like plans or design books for ideas.

5. Prefabricated Homes - These homes are built on a factory floor and are then transported to your location and set up as a complete home. This option is great for those who have areas of their property already cleared or maybe you just want to avoid the hassle of building from scratch yourself. Potential buyers can tour model homes and pick and choose the features they would like their home to include. A big advantage of this route is that there will be very little time spent in completing the construction process since it will all be done before the home arrives on your lot.

6. Do It Yourself - This might sound like a crazy idea, but if you consider doing something such as adding an addition onto your house, adding a few rooms, installing a pool or even finishing part of the basement with drywall, joists and insulation, you could save significant money by doing much of the work yourself. Keep in mind though that while this type of home construction will save you money, it will also take much more time to complete, especially if you don’t have prior experience in the field. If you still want to try this method out, make sure that all building codes are followed by hiring a professional when help is needed such as with electrical, plumbing and other types of wiring.

7. Lease-options - This is where an individual or company makes part of their property available for lease on a long term basis so that at the end of the contract, the buyer has an option to purchase it outright if desired. The key advantage here is that oftentimes, housing prices can be lower than buying a home directly because people who build houses and sell them at market value usually cannot get enough profit to make this option worthwhile.

8. Mobile and Modular Homes - These homes are built using a pre-built steel frame that is affixed to a flatbed truck or heavy trailer for easy transportation. The benefit of these types of houses is that they can be moved anywhere you want so that you are not restricted in the area you live in like with traditional home buying options. This is also a great option for those who are on a tight budget as these homes often cost much less than other options without sacrificing quality too much.

Real estate photo

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What are the Benefits of Buying a New Construction Home?

There are dozens of benefits that accompany buying a new construction home. Here is just a glimpse at some of the many advantages:

  • Better quality home design and upgrades. 
  • Usually most of the work has been done for you, including landscaping, fencing and more. 
  • Reduces time cost from buying a fixer-upper or older home with repairs needed. 
  • Builders have more financial incentive to finish your home with care and quality. 
  • A sense of pride in ownership as you watch the home being built. 
  • Time savings can make moving to another house much less stressful since you will not be facing any last minute repairs that might stress the family. 
  • Usually already has electricity, gas and water turned on which means you do not have to wait for those utilities to be installed before you move in.

What's Involved in the Buying Process? 

1. Find a builder: If you want to move forward with buying a new construction home, you should first find a builder that appeals to you. Interview multiple builders and find the one that is going to best suit your vision. 

2. Sign a contract: Weigh the pros and cons of the contract before signing it and make sure that there isn't anything in it that will be too expensive or troublesome for you to maintain in the future. An experienced real estate agent and a lawyer will be able to help you ensure you’re getting exactly what you’re expecting. 

3. Choose and visit the location: Consider proximity to work or school, commute time, traffic patterns, etc. prior to making your final decision about where the house should go. Make sure your potential new home is going to fit your lifestyle. 

4. Find your ideal floor plan: Ask for a set of house plans and any other information that might be needed to be able to get your home financed if desired. You’ll also be choosing exterior and interior materials at this time, so do some research and find what you like! 

Finding the Right Floor Plan

5. Design your interior: Select features such as paint colors, kitchen counters, roofing materials, etc. to be installed in the home before construction begins. Keep in mind that many model homes feature upgraded features and you do have the option of asking for the company’s standard (and less expensive) features instead. 

6. Appraise the property: To avoid getting ripped off in buying a new development home, don't take the developer's word for it—which might be more about profit than quality craftsmanship. Instead, hire an independent appraiser to come in and give a more detailed assessment of the property you are considering before moving forward with the purchase.

7. Review the final documents: Finalize all details of your contract with the builder including payment options and any changes or modifications to be made to the home before it is completed. 

8. The final stage: Sit back and wait for completion! Your new house will arrive on site ready for occupancy! 

Real estate photo

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Can You Save Money When Buying a New Construction Home?

There are several ways to save money during the new construction process including: 

  • Make sure the builder is reputable and has experience building homes in your chosen area.
  • Find out what other properties are being built by the same builder to get an idea of how it compares, pricewise.  
  • Get the home built before peak season so that you have it ready for the fall and winter season, when housing costs are higher.  Buying in a slow market means you can negotiate more and pay less.  
  • When buying from a bank or government agency, make sure the seller is not requiring building permits being signed over to them prior to paying the rest of your money. This way they can't turn around months later and say "Oh, we don't have plans to build there anymore so we aren't going to transfer those for free."  You might never know about this until you try and get building permits years down the road.

Buying a new construction home is an exciting process. It can be an affordable option, and it's so satisfying to customize your dream home from the ground up with all of today’s modern amenities such as energy efficient appliances, sustainable materials, and more. If you're considering buying a new construction home, be sure to do your research thoroughly and ask a lot of questions before you make that important step forward. has become Hilton Head and Bluffton’s real estate resource on the internet. We’ve built a real estate search website with cutting-edge technology to ensure you never miss out on a newly listed property -- or a price reduction -- that makes your next purchase possible. 

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