Whether you are a First Time Buyer or a Seasoned Veteran, New Construction is incredibly exciting. Being the first owners for some people is the ultimate status symbol. Lee and I sell our fair share of New Construction and we know there are specific buyer types for each different stage of the process. Lee has suggested that it is best to split it into three (3) stages: Pre-Sold, Drywalled and Mudded and finally Complete. In general its what the Buyer can see that influences which of these three (3) stages they feel comfortable enough to make an offer.
Pre-Sold - There is nothing built at all and the foundation has yet to be poured. The buyers here are buying a dream, or a concept. They most likely have walked the lot, but not always, and know where the house is going to be, but everything else is being done by looking at the House Plan. This can be really tough. Some people have difficulty with dimensions and simply cannot imagine what the finished product will be. Room sizes, how their furniture will fit, or even if their furniture will fit. but or how the finishing will look. Pre-Sold requires a special buyer who is able not only able to imagine the finished product, but also has the confidence to make finishing choices that will determine how the house looks on completion. When you pick everything there is no one else to blame if your choices don't really come together when its finished. Roof shingles, siding colour, window styles, all big decisions. Ask anyone if they are 100% happy with their kitchen cabinets and counter tops (and they picked them). Stained hardwood and ceramic tile, plumbing fixtures are much harder to change than room colours if you don't like them after you see the When my wife and I built our home selecting the most mundane housing items became major life changing decisions (or so it felt at the time). In my opinion only 10% of all New Construction Buyers are prepared to buy a home at this stage.
Drywalled & Mudded - For some people this is the point where it all becomes clear! The exterior is finished and the Buyer can see pretty much what the house is going to look like from the curb. Its funny how the rooms seem to grow once the drywallers are finished and the primer paint is applied. You still do not have kitchens, bathrooms and paint but at least now your dream home has some structure. Its quite common here for an equalling effect to come into play. If a couple has one person who can see it from the Pre-Sold and one that can only see the fully finished product on completion then commonly this is the stage where the compromise occurs. Its common now for kitchen cabinets to be drawn on floors, along with bathroom items and other fixtures to give potential buyers an idea of finished layouts. You still can select kitchens, bathrooms, flooring, paint and trim at this stage and really make the internal of this home your own. At this stage I estimate 40% of New Construction Buyers are prepared to buy at this stage.
Complete - There is no mystery in this stage, everything is complete including all internal and external components. Buyers get to see the completely finished product and there really is nothing to worry about. However, as its finished you have no options to change anything and anything you do want to change is not going to cost extra. People do fall in love with homes at this stage but more importantly they are falling in love with a home that only a few weeks earlier they would walk straight past. Simple Math will tell you that my estimates mean that 50% of New Construction Buyers will buy now.
So why is this important to you? Well, knowing what you own limitations are can save you a considerable amount of time and money. Additionally, being realistic and telling your Realtor what your comfortable with can save you and him/her a whole load of time and let them concentrate on whats important, namely getting you the perfect home!! Also, how many times have you seen the price of New Construction go up while the house is being built? Clearly a house that is closer to being finished is easier for the builder to sell and can therefore perhaps command a higher price, plus there is also some carrying costs now involved.
There is no shame in not being able to see a finished house from a set of house plans. Decision making can really be quite stressful, and looking back on it you might have thought that it would have been so much easier to have bought at the second stage. But if you really want to make the home your own, with all of your own design choices you will have to work through all three stages.
So, if you decide to buy New Construction, give the stages some thought. Where for you and your family fit into the process! When you know that, you will know your comfort level, and the process will go that much smoother for you , your agent, and your builder. Best of luck and enjoy your new home ... you worked for it.