D.L. asks from McKinney, TX on August 12, 2007
Negotiating on New Home Construction
We had a home built 10 years ago and are now ready to purchase our "final home". We found a new neighborhood in McKinney we fell in love with this afternoon but it is new home construction.
I was wondering if anyone out there knows if these home builders expect you to negotiate with them on the price or not. Is it like buying a car? Or do we pay the asking price? They have some small incentives but there was no lack of potential buyers coming and going while we were there. So I have an idea it's a hot neighborhood they can sell without too much give-ins. Or maybe it's all in my head since we just loved the area and the homes and I'm thinking that I have to BUY NOW!! Gosh it's so much stress.
When we built this home, we were so young we just paid what they asked for it. But this house would be considerable more in cost and I'm a bit wiser to the world these days.....except for this hahaha.
Any comments or advice from you wonderful, experienced home buyers would be great!
H.C. answers from Dallas on August 12, 2007
Sure you can negotiate, whats the worst they can say, no???? When we built our house in FL a few yrs ago, of course that was the time when the market was HOT, houses sold in hours and for more than asking price, but that was then, now...well you know the market is not so great and builders are very willing to sell for less. Like I said whats the worst they can say, no???
B.S. answers from Dallas on August 13, 2007
Your story sounds so familiar... We did the exact same thing! But our second house, we definitely neogtiated. It was a spec house and the builder was ready to sell. You can negotiate on new construction or check out any houses being built that aren't sold. If they are a floor plan you like, you will probably have a little more bargaining room. I would however, based on our experience, try to get a house that isn't totally finished so you can add some of your own taste to it as it is being built. Best of luck to you!
S.N. answers from Dallas on August 13, 2007
Absolultey negotiate the final price. Do your research and find out what comparbable homes are going for. We paid asking price for our first home, which we had built in Houston. What a mistake. When we went to sell it, we actually lost money because we overpaid to begin with. For the home we built here in Dallas, we negogiated the final price with any upgrades we wanted built into the final price. By the way, don't upgrade yourself out of the neighborhood. That was another mistake we made in Houston. We upgraded too much, and couldn't recoup those costs when we sold the home. Besides, a lot of upgrades you can do after the home is built much more cheaply than the builder will do it for. Good luck!
K.M. answers from Dallas on August 12, 2007
I certainly don't have any tricks of the trade, however, by hubbie read the wall street journal every morning - and reports that the market here in tX and nationwide is changing - its very much a buyers market -- and you should be getting tons of free options, free pool, finished basement, etc. in this recent article that came out on Friday. Never give them what they are asking; make an offer based on comps and do your research for what has sold in that area - get a realtor to do some of the leg work for you as well -- best of luck. We are looking too - but my dh doesn't think we have hit bottom yet - and that builders especially are going to be juicing up the incentives the closer we get to a truly crash in the housing market. Oh, mad money tv program also offers lots of tips about the housing market crashing as well. best of luck,
J.I. answers from Oklahoma City on August 12, 2007
Price is ALWAYS negotiable. You can also ask the builder to throw in some upgrades or change small things in the floor plan if you are building from scratch. Our house was a spec house and we paid $60k less than the asking price and they agreed to do some cosmetic changes like change the wallpaper, move the fence, and a couple other things. Your realtor should be able to help you figure out what would be a good starting offer.
K.R. answers from Dallas on August 13, 2007
Hello D.! I'm an agent with Keller Williams, so I can definitely give you some advice in this area. YES! You can negotiate as you would when buying a pre-owned home. Depending on the inventory in the community, they may and may not be willing to consider a price reduction. They will usually always throw in some upgrades though. Builders are very open to working with buyer's agents, so keep that in mind as well. The builder pays the agent's commission and it doesn't affect your sales price. That's the best way to go to ensure you have adequate representation and negotiate the very best deal for yourself! Good luck! Feel free to write/call if you have any additional questions.