Anyone keeping up with the current real estate environment understands the challenges buyers are facing. It's a scarce inventory market and finding the right home is tough, getting ACCEPTED is much tougher. Luckily our team has strategies to position our clients’ ahead of others, but sometimes an offer comes in $100K above the rest, all cash, contingencies removed and unless you’re willing to risk a lot, you’re back on the search for the next one. If your budget is tight and competing against cash offers with large appraisal gaps is not realistic for you, you may have considered a “fixers” approach -- finding value add property and building it into your dream house. It's a nice thought, but unfortunately you're not the only one to think that - and you'll most likely still be competing against multiple offers. This is why, instead of looking at fixers, you should be purchasing a NEW home instead.
ONE. You’re not competing with price. New development sales are dominantly a first come, first served approach. Prices are set and the acquisition of the property is based on the order of their priority list. (Priority buyers = interested buyers who have qualified with their preferred lender). So, if you’re #1 on their priority list, they’ll reach out to you FIRST and offer the home to you. If you’re #3, they’ll offer to the top two first and only if they don’t want it will you be offered the home, at the LISTED PRICE. There’s no offering $150K over list price to compete (a very realistic scenario in our local real estate market). The only thing you’re competing for is your position on their list. If you like a home in a new development, get on their priority list ASAP!
TWO. It’s brand new. Let me say that again, it’s BRAND NEW. Which means you don’t have to move in and spend a ton of money fixing it up. Updates/repairs can add up to be very costly, let’s have you save that money.
THREE. You have added protections as a buyer against defects. One of the bonuses of purchasing new construction in CA is that, under SB800, you have certain legal protections against builder construction defects. One of the many requirements is that a builder must provide homeowners with a minimum of a one-year “fit and finish” warranty.
You can read it in detail here: SB800
A modern, turnkey home without competing against multiple offers? YES PLEASE!!
**Oh and if you're looking for our latest new construction listings, click here: mynewLAhome.com**
Happy House Hunting!
Som, great points and rationale for purchasing new construction!