Are you thinking about buying new construction in St Augustine? Thomas is going to cover all of the pros and cons of new construction here in St. Augustine Florida. If you are living in St Augustine, or relocating to St Augustine; this video will outline the good and the bad of building new construction homes in St Augustine FL.
New Construction has been on fire this past year. Builders have had a wild year trying to change along with the market. Co-vid has caused delays in supply chain, manufacturing and also the workforce. If a job site had one co-vid positive person, everyone had to quarantine for 14 days. The inventory squeeze on top of the supply chain issues made a lot of builders adjust their process. At one point you would have your pick of move-in ready homes within a community.
Today there are no move-in ready homes in our entire market. There may be one or two that pop up that fall out of contract because of buyer financing, or changes in contract.
One of the major pros of buying a new construction home right now is that resales are at the same value. The median sale price in St. Augustine is just under 400k. You can actually get in a new construction home for significantly less.
The negative to that is really based on individual need; if you need to move now because of work, school or familial reasons, the timelines with new construction may not work for your immediate need. Especially with how their time-frames have been thrown off.
Brand New Home. Everything is new. Most builders will give you a 2 year material defect warranty, and a 10 year structural. All of your appliances that are provided will come with manufacturer warranties. You shouldn’t have to worry about anything for at least 5 years in most cases. If you buy an older home you may run into a large capital expenditure right when you purchase the property. Your insurance will also be cheaper because it is a brand new home and current building standards.
Honestly it may not be your style. I go into my grandmas house and its been the same for 20 years. Styles I find attractive, she finds ugly.
Preferred Lender Incentives – Most builders will work with a preferred-lender if you are looking to leverage a mortgage. This is a great opportunity because a lot of the time they will pay all or a portion of closings costs; as well as buy down interest rates. I know of one builder in the area paying up to $10,000 in closing costs right now in our market. This may not be a lot of money to you, though it lowers your cost to get into a home and your money out of pocket.
The negative to this is that it eliminates choice. You are free to use whatever lender you would like, though you can only get the incentive through a preferred lender. A lot of times the lender is also owned by the builder so the double end the deal.
Neighborhood – Everything is new. More than likely an HOA or CDD that takes care of amenities.
Depending on when you are buying you could be buying in a construction site for the next 2-3 years. The neighborhood will not be as “Mature” as others. Cookie cutter isnt the right word to use anymore. Though the homes are really similar in a lot of communities. Builders have done an OK job of switching it up on the exterior.
Timelines – The best builders are doing what they can to meet deadlines; some go off with out a hitch. Co-vid and supply chain issues have caused a plethora of delays. So many things can happen between the time you sign the contract and the time you close; and for the most part there is nothing you or I can do about it.
Price Appreciation – With how our market is moving, the cost of homes is starting to rise rapidly. We had a 20% increase in prices this past year. It takes almost a year to build these homes. So when you have the ability to move in you should walk in the door with some equity. Builders also have raised prices on the same model you purchased because of demand and also because of the rising costs to build.
It could also go the opposite way and depreciate; which in that case you can cry in your brand new house.
Contract Changes – Builder contracts are very one sided. They favor the builder heavily in any contract disputes. The site rep looks out for the builder, their employer. I the agent represent your best interests. There are things written in the contract that I can not do anything about; it is what it is. Since some builders took a bath on lumber, they have changed their contracts to allow for price increases after you have signed. This can vary on builder and the contract.