7 Tips to Ensure Building Your Dream Home Doesn't Become a Nightmare

In seven years I have handled 100+ new homes builds with my clients. New home builds are always trickier to manage than buying a resale home. This year it became a little more complicated. For instance, I have a client whose costs to build just went up $12,000.00 before construction even starts, and a friend whose home is already 2 weeks behind due to labour shortages (it’s only at the footings stage). This is barely the start of the construction season and I predict many buyers will experience something similar in the coming months.

With this in mind I thought it timely to offer the following 7 tips to make sure your new home build is a pleasant experience.

1. Build your new home in an organized subdivision. The builder will have established relationships with all the trades and is therefore more likely to bring your home in on schedule

2. If you need to sell your current home to buy your new home pay close attention to the closing dates. Given the current labour crunch you would be wise to anticipate a delayed closing on your new home. Prepare for such a contingency by negotiating a flexible closing on your existing home, arranging alternate accommodations while waiting for your home to be completed, or waiting until you can get a firm closing date before listing your current home. It may also be a good idea to see if you qualify for bridge financing should you have to take posession of your new home before your present home is sold.  

3. Pay particular attention to the economic clause in the contract. You should always pay attention to the contract. However, this year most builders added an economic clause to their contracts. The new clause gives builders the right to increase the price of the home up until a specified period of time. In my experience the builders have chosen to set the final price 3 weeks prior to the beginning of construction (excavating for the basement). Other builders may set different timelines.

4. Make sure that the agent you use is well versed in new home construction. Your agent may be the builder’s agent or an independent agent who works solely on your behalf. Whomever you choose it is important to ensure you are working with someone who has extensive experience in new home construction.

5. Have a licensed home inspector check your new home prior to taking possession. There is no doubt that there will be a labour crunch this construction season. Tight timelines and difficult scheduling means that corners may be cut. A home inspection is the best way to ensure your home has been completed to a satifactory standard. Of course it is also important that the home inspector you choose is experienced and knowledgeable. Click here to find a list of Newfoundland and Labrador home inspectors who are members of the Canadian Association of Home and Property Inspectors.

6. It is always important to do background checks on your builder. These should include the following: 
     - Determine if the builder is a member of the Better Business Bureau. If he or she is, check to see if there have been any complaints registered against the individual or the company. 
     - Determine if the company and/or the builder is a member of the Eastern Newfoundland Home Builders Association. 
     - Determine if there are there any outstanding lawsuits against the builder or the  company?

7. Choose a builder who offers a new home warranty. The gold standard in the industry is the Atlantic New Home Warranty. It is important that you fully understand what is covered in the first year, and subsequent years, and who is responsible. For example a builder is seldom responsible for the roof; it is the roofing company that assumes liability for any problems. For that reason it is important to do similar background checks on any sub trades not covered under the builder’s warranty.

I hope you found this blog post helpful. If you have a suggestion to add to this list please send it along. I, and I am sure the other readers, would like to see it.

If you would like assistance with your new home build or have questions please call or email. I'm always happy to answer any of your real estate questions.

Comment Notification

Subscribe to this post's comments using RSS