Fourteen Important Questions You Should Ask Before Building a Home



As a buyer begins the process of checking in to building a new home, it is easy to get caught up in the moment of emotions. This is where your realtor can be a great asset. Your realtor can help take the emotion out of the equation and focus on getting answers to these questions and others.

I have listed some questions that have been asked before or during the process from buyers. It is important to collect as much information upfront as you can, as knowledge is power.

Starting the process….


 Are their currently any incentives being offered? 

This is more commonly found with inventory homes already built and not as much on a pre-sale (a home not yet built) but doesn’t’ hurt to ask.


What homes have recently sold, not listed in the MLS?

This is so you and your realtor can confirm houses are being sold at list price, below, or above. 


 What is the expected builder deposit amount? 

 If concerned, ask the builder and your realtor to explain on what terms you could lose the deposit if you back out. It generally depends on how the contract is written.


What are HOA fees?

Many times there is a set payment amount and a one-time capital payment. Ask builder to provide HOA documents & restrictive covenants as well. 


What are the standard features that are generally included?

Some builders may not include a garage door opener, microwave, ceiling fan boxes, etc. as a standard feature. Many do include granite countertops as a standard feature in NC.


Do they work with a preferred lender who will pay some of the closing costs?

 If so, how much? Shop around and see if your lender will match or beat their incentive.


 Do they require you to go through their pre-selected attorney?

Many builders use their own contracts and have attorneys who are familiar with them.


What does the warranty include and how long? 

 In NC the general warranty is one year. However, some items have a longer coverage period. Builders can vary in regards to the warranty package.


 What is the walk-through policy?

Staying informed during the process is important. Ask for a schedule of meetings expected. Typically, you will have a buyer orientation meeting/pre-construction, pre-drywall Walk-thru, Blue-Tape Walk thru (where they let you inspect for cosmetic defects as well as any issues and ask questions), and a final walk thru.     


Do you have any policies against inspections?

Builders are great, but they are human. Mistakes will happen and it’s best if they are caught along the way. This can be done by having a 3-part home inspection. You can request to have a foundation inspection, pre-drywall inspection, and final inspection. These costs are not built into the price and are at buyers expense.


Additional FAQ's...


 Why are builders less willing to negotiate sales price?

Many builders work in a subdivision with interest in community value. In order to protect you and the others in the subdivision or community, they need to have consistent pricing in order to maintain the value. Builders are much more likely to negotiate with you on updates rather than on sales price for this reason, especially in a hot market. After you are closed, you will want the builder to maintain the prices so your home value will hold up if you have a need to resale it.


 Why must I use their attorney?

Every state is different, but in NC, the builders like to use their own contracts and the attorneys. They are familiar with the contracts and typically results in a smooth transition. The attorney takes care of the title search, prepares the settlement statement, and transfer of title. You can use your own attorney at your own expense. However, the builder will generally pay for the attorney who prepares the deed and process the closing. There is really no need for two as the attorney is working on both sides. It also saves you a little money as the buyer.


Do new construction homes need to have termite treatment?

Again, every state is different, but in NC our builders pre-treat the soil for termites. This gives the buyer coverage for the first year and at closing, you should receive a soil pre-treat letter to cover this. Termites are wood destroying insects and to protect the home, should be inspected on an annual basis in areas conducive to termites.


Can I call any handyman after closing?

In a new construction home, in NC you get a 1-year builders warranty. The builder will provide you with his subcontractor's contact information, as well as instructions to follow to keep the warranty valid.  Be very careful when doing any type of work to the home or property. You will want to use his vendors or get permission from the builder in writing to make changes to the property, not to risk voiding your warranty. For example, if you want to install a product that requires electrical work, call the electrician on file. If someone else does work on the electric, when something else goes wrong they don’t know who to call. You as the homeowner will then be responsible.  Yes, you can do the work yourself or call someone else, but the builder may not have to honor the warranty afterward.


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