Buying a new construction home can feel different from buying an existing home. You may spend weeks, or months, choosing a floor plan, homesite, finishes and upgrades. But one of the most important parts of the process can happen before any of that:
Signing the contract. A new construction contract isn't just paperwork that gets you in line to build a house. It establishes the terms of the purchase. It can spell out what you're buying, what you're paying, when you're expected to pay it, what happens if something changes, and what happens if either side doesn't meet its obligations. And builder contracts can be very different from one another. So before you sign, don't just ask:
"What's the purchase price?" Ask:
"What exactly am I agreeing to?"
Why New Construction Contracts Are Different
When you buy an existing home, you're generally purchasing a property that already exists. With new construction, you may be signing a contract for a home that hasn't been built yet. That means your contract may need to address things that wouldn't be as significant with an existing home:
- Construction timelines
- Builder selections
- Change orders
- Materials and finishes
- Construction delays
- Lot premiums
- Deposits
- Financing
- Inspections
- Substantial changes to the home
- Completion
- Closing
- Warranty obligations
The contract is essentially creating the framework for a transaction that will unfold over time. That's why reading it carefully matters.
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