Buying a New Home in Colorado
This past weekend I stopped in to see some model homes in a new home development. While talking with the saleswoman I realized that many home buyers might not know what questions to ask to be sure new construction is right for them. Buying a new construction home can have different challenges compared to purchasing an existing home.
Please Note: If you are just starting out on the home buying process, and aren’t even sure if new construction is what you want to buy, download my Home Buyer Questionnaire to get started.
Here are a few things to consider asking about when speaking with a salesperson at a new development.
Sales Price – Unlike purchasing an existing home, the base price provided for each ‘model’ is a starting point. There are additional costs to be considered which will vary depending on the builder and the buyer’s choices. These costs may include: lot premiums, interior upgrades, landscaping, exterior finishes and more. For a longer discussion on base price and sales price click here.
Build Schedule and Lot Releases – Large developments will typically be built in phases. If there is a high demand for homes the builder may choose to release lots in groups as construction progresses. You may need to wait to purchase a home on the lot you prefer.
Property Taxes – Property taxes in Colorado vary widely throughout the Metro Denver Area. For new construction you can’t just rely on county records for property tax values. Vacant land is taxed differently than a lot with a completed home. Be sure you get a good estimate on what the property tax rate will be on your finished home from the salesperson.
Financing & Contracts – Builders may encourage you to use their finance partners through incentives which not necessarily a bad thing, saving money is always good. Be cautious when using your own lender and be sure you are clearly communicating the important dates & deadlines or you could be in breach of your purchase contract. Builders DO NOT use the same contracts as those used when purchasing a pre-existing home.
Home Owner’s Association (HOA) vs Metro District – Most, not all, new developments will have either a Home Owner’s Association or a Metro District. These are governing entities that will provide guidelines for the community in which you will be living. There may or may not be a fee associated with belonging to the HOA or Metro District and the cost and amenities may vary widely between builders and communities.
Feel free to reach out to me for more information on purchasing a new or existing home. I am happy to help in whatever way I can.
If you are just starting out on the home buying process and aren’t even sure if new construction is what you want to buy, download my Home Buyer Questionnaire, to get started.