23 Things to Do Before Buying a New Construction Home

The List

New construction homes are an important, and exciting, portion of the market when you go out to buy a home. NAR consistently shows that around 15% of home purchases per year are newly built in their annual surveys.

Here is a list of things you want to do before going to closing on a new construction home.

1. Make a Budget

Before making a large purchase, it is a good idea to take your financial temperature. And a home is likely for most to be the largest purchase that you will ever make.

So before diving in, some due diligence on your price range is in order.

A monthly budget can help you see get ready for a new monthly payment and see where your down payment will come from.

2. Use a Mortgage Calculator

If you want to know approximately what your payment will look like with different interest rates, property taxes, insurance, etc. it is a good idea to plug them into a mortgage calculator.

You can use this tool during your budgeting to start to get an idea of what to expect.

3. Talk With a Loan Officer

Your price range will be decided by you, the buyer, but you also need to make sure what you can qualify for. A mortgage lender can help with this.

They will give you an idea of what the max is that they can loan you, what down payment to expect, what monthly payment you can expect and then you can know what the top amount you can spend is.

4. Choose a Real Estate Agent

Real estate agents can add large value to the new construction process.

And getting an agent on board early means that you will be ready, because sometimes the contract process can move faster than you think.

Remember, the builder’s reps are very helpful and a useful source of info during the transaction. But they are representing the interest of the builder.

Your agent is there to look after your interest.

5. Plan For The Design Center

The advertised price of a new construction home is often very different from the contract price and final sale price.

One reason is because the advertised prices often have the most basic level of finishes. After visiting the design center, most buyers add to their contract price by choosing upgrades.

Knowing this up front is helpful. How much you will actually spend depends on the builder, community and type/size of home.

6. Figure Out Your Needs

Where do you want to live? How many bedrooms? Do you need a garage? What style home do you want? How far do you want to drive to work?

These are all questions to ask. Decide on what the “must haves” are. You might not get everything you want, but you want to get the non-negotiables.

7. Decide On a Price Range

Get firm on what you want to spend, all in, on your home. Sometimes, this might be the max you can get a loan for. Other times, it will be below that.

Either way, finalizing your price range will help narrow your search and you can know what to look for.

8. Research Areas

The more you can narrow down your search, the easier it will be. Sometimes, you know quickly where the community is you want to live.

Other times, it will take some more research.

Driving around or spending an evening in a town can be a great tool to take an area for a test run.

9. Make a Flexible Moving Schedule

New construction homes can vary on when they are ready for you to go to closing and move in.

Some you find for sale may be nearly complete, in which case a 30 day closing can be an option.

But if you are buying a lot that has not been started, the process can take many months, or even a year or longer. And many times there are delays in construction, so your expected closing date could change after you sign a contract.

So make sure you have a long term place to stay until your home is ready. And a little flexibility even toward the end of the process may be needed.

10. Make a Plan for Selling

If you have a home to sell, you will want to make a plan with your real estate agent on timing.

There are pros and cons to selling at different times during your construction process. It will depend on your financing, the timing of your builder and more.

11. Check for Resale Homes

Ok, so you want new construction. There are many benefits to buying a new home. But, what if there were a home that was just a few years old that would meet all of your needs?

Sometimes there is not, depending on the area and the inventory. But if you find a resale home, there is a chance you could save some money.

12. Get Loan Documentation Ready

Builders generally expect you to work diligently with your lender toward getting loan approval. Many times it is written into the contract.

And you also want to move quickly to make sure that you get your financing squared away before any financing contingencies are up.

Make sure you have access to your recent tax returns, w-2s, bank statements and other financial records.

13. Ask About Rate Locks

Having an upfront discussion about different options for locking in your loan’s interest rate is a good idea.

Rate locks generally only last a certain amount of time (for example, 60 days). So if you choose a new home that has a long completion date, you will want to remember to keep in touch with the lender about rate locks.

Not locking your rate until later can mean a lower rate or higher rate than what is currently offered, as rates move with the market.

Rates are not in your control, but a good conversation to have upfront with your lender and to make a plan for when to talk about locking it in.

14. Visit Model Homes

To get an idea of what you are buying, builders usually utilize model homes. These are showcase homes made to show off the top finishes and highest level of updates.

Keep in mind, some models may have features and finishes not available in the design center.

Depending on the size of the builder, the model could be off site from the community. It could also just be a completed home and not necessarily a fully upgraded showcase.

But most large builders in large communities utilize the model home.

15. See a Home Being Built For a Buyer

After you see the model, it is a good idea to ask to see a home being built for a buyer of the community, if available.

Why? Because this will give you an idea of what the builder actually is building vs. the model home. This can give you an added level of comfort being signing the contract.

16. Ask About Available Homesites

Builders many times release different lots at different times. And smaller builders building on one lot within an established community may have more homes elsewhere.

If you like a builder, but are not crazy about the lot they show you, they may have others upcoming.

17. Check for Builder Incentives

Many builders, particularly larger companies, offer incentives at different times during the construction of a community.

These could include help covering closing costs, credit to use at the design center or perhaps even a lowered price.

Many times incentives are tied with using the builder’s recommended lending partner, title partner or both. But this is not always the case.

18. Review Your Contract

Even if you have purchased a home before, you will want to go through the contract. Builder contracts are different than most resale contracts and each builder may have some different terms.

Knowing your rights and responsibilities with your particular contract is the smart way to go through a transaction.

19. Review Your Warranty Info

One of the perks of going with new construction are the warranties. There are different warranties on different items and lasting different timeframes.

Read and keep a copy on hand for future reference of all warranty info. Some warranties may be serviced by the builder and others by a third party company.

20. Read Your HOA or Condo Documents

If you are buying into a community with a Homeowner’s Association (HOA) or a condo complex, you will receive a package with a set of bylaws, financials, amenities and more.

21. Ask About Walkthroughs

You are going to have a few different points to walk through the home with the project manager or another builder rep during construction.

How many walkthroughs and when they occur will vary based on when you get a contract on the project and the builder.

But you want to make sure you are ready for these times.

22. Get a Home Inspector

Even though you are buying a new home, you want to get it inspected. Even though there will be code compliance inspections, those are not there for quality control of all aspects of the home.

An independent home inspector works for you, and can make give you a professional opinion on if there are any deficiencies.

23. Get Ready to Ask For Improvements

Most respectable home builders want you to be happy with your home and their craftsmanship. So make a mental note that you and your agent should request for items that need improvement on the home inspection.

They may not fix everything (maybe they will), but I have found that they are open to correcting deficiencies if you request them.


New construction homes are very popular among buyers, and especially large planned communities with brand new amenities.

However, the process of buying a new home is different than a previously owned home. See our ultimate guide for more info.

This list is a starting point as you start to think about buying a home from a builder.

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Will Rodgers

Will Rodgers is a real estate expert, creator of this site and partner at the Alper Real Estate Group. Will has been sought after by many major publications for his expertise and creates sought after content for buyers, sellers and investors.