Chicago Life and Style.

Your Home. Your Life. Your Style

New construction-awesome! Or…meh.

There are a lot of people drawn to the idea of buying new construction and living in a home that has never belonged to anyone else. The general feel is that new construction is clean and fresh and since it’s new, it’s in great shape and there won’t be any problems. I like to make the analogy to a puppy. Sure, a puppy is new and cute and hasn’t picked up any bad habits and will love you and only you. The flip side is that you have no idea what it will look like when it’s fully grown and it has yet to develop it’s mature personality–which might not turn out to be what you were hoping for.

As great as it is that the real estate market is healthy and new homes are once again being delivered quickly and in good supply–think twice before jumping into that brand new sparkling home.  When you purchase new construction you are usually given a home warranty and you use the developer’s contract instead of the standard Association of Realtors contract. They home warranty makes you feel good, as it should. But, like those you can get from a seller on not new construction–they aren’t really as effective as we would like to think.  The reality is, unless there is a gross defect in a basic system, it won’t cover the problems you are likely to see.

Of course there is nothing inherently wrong with new construction, it’s just really important to do your homework. There are plenty of things you and your broker can do to help mitigate some of the unknown risks in a brand new house.

  • Find out how long it took to build the house–quicker is NOT always better
  • Find out when the foundation was poured–by when I mean, what month. Check the weather and see if it had sufficient time to cure based on weather conditions.
  • INVEST IN A MOLD TEST – water intrusion is the #1 problem we see and even though it may take a while for actual mold to show up, it’s worth paying to do a test to look for moisture
  • Look at some of the developer’s other projects–then have your agent research their sales history–if you see that many people leave houses built by your developer after a year or two–RUN AWAY!

The other really important factor is getting a really, really good inspection. The kind of inspection that has 150 items listed and is super scary. Trust me, it’s worth being scared and then either deciding you can get over it, or walking away. Some of the things that a good inspection will catch but aren’t caught by everyone:

  • electrical outlets that are in the wall but aren’t working
  • make sure that your sump pump is working and on a battery back up
  • run all the appliances through a full cycle, including washer/dryer

I bought a gut rehab many years ago before I was in the business and relied on my agent at the time to suggest an inspector and it was a disaster. I had outlets not working, a toilet that didn’t work, furnace that was barely functional it was so dirty from construction dust, among other things. I discovered these things AFTER I moved in. I have a neighbor across the way from me that basically had to rebuild their brand new single family after tearing it down and remediating the mold. The best (or worst) was another neighbor in the ‘hood that invested in 8 ft decals and posted on their front windows about how horrible their new construction house was and to beware the developer. Unfortunately, the bad developers usually just file bankruptcy and then operate under a different company name so its very unusual to be able to get them to fix the problems or compensate the new owners for repairs.

Last but not least–remember that new construction does NOT come with window treatments as do re-sales.  It seems like a small thing until you realize that depending on the treatments you want, you could be looking at another $40k for a full house, especially if you have specialty windows. To bring it back to our puppy analogy, houses have personalities too, and any new home–new construction or otherwise–is going to have “growing pains” as it gets used to its new owners.  Expect some issues to pop up and don’t be discouraged, most of the time the issues are small and fixable and pass as quickly as the puppy teething phase.

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