Tuesday, February 19, 2019 / by Jeremy Feldman
Savvy home buyers often get great deals on new home constructions by asking for deals and discounts and doing some up-front research.
Home builders often dislike offering steep discounts in sales prices because they want everyone in the community to feel like they bought their property at a fair price. Maintaining sales prices also helps with future home appraisal values. It helps all of the buyers in a neighborhood to keep sales prices consistent and growing.
Fortunately, you can still get great discounts that can reduce the cost of your new home.
Ask the builder if they can do the following:
Settle Closing Costs
Closing costs vary depending on your state. On average, the costs can be as high as $10,000. In Colorado, for example, a standard closing is about 3 percent of the selling price.
It's important to note that closing costs vary widely and can be structured in many ways. Make sure to consult a trusted mortgage finance professional to get the best information on your situation. But if the builder pays the bill, that money remains in your pocket. Isn't that a great discount?
Buy Down Your Interest Rate
Although interest rates are low, if a builder is willing to buy down your rate further as part of the closing, it would reduce the amount you pay monthly in interest on your mortgage payment. That makes it manageable in the long run. Once again, your mortgage professional can give you the best details on this idea.
Offer Free Upgrades
Most homes have standard built in appliances. To get high-end appliances, home buyers normally have to pay for upgrades. Ask your builder if you can get the upgraded home appliances or other upgrades without paying extra. It's a great strategy to move into an improved new home.
To sweeten the deal, home builders can throw in additional discounts such as automated garage doors, landscaping, finished basements and window coverings. These discounts are worth asking about.
Although these strategies are great, there are some situations that make it more difficult to get sales concessions. Therefore, as you negotiate, keep the following in mind:
- If business is going great, deals become more unlikely as builders have little motivation to give discounts.
- You may not end up with the perfect home you want since you may be buying a home that's near completion or already built.
- The best home locations may be taken because properties in prime lots are usually the first to sell.
Knowledgeable buyers are most capable to cut great deals. Therefore, research new construction homes in your preferred neighborhood, visit some homes and compare what deals you can get. Above all, don't hesitate to ask questions of your trusted real estate and mortgage professionals.