What To Negotiate When Buying New Construction Home in Arizona
Purchasing a new construction home in Arizona can be exciting, but it’s also a process where negotiating the right terms can save you money and get you more value for your investment. Unlike resale homes, there are unique aspects to buying a home directly from a builder. Here's a guide to the key areas you should consider negotiating:
1. Options and Upgrades
Many builders offer incentives towards upgrades in the design center, allowing you to customize your home with features like upgraded flooring, countertops, or cabinets. While big-ticket items like flooring and kitchen upgrades may be harder to negotiate, some builders may offer allowances or discounts towards other customizations.
You’re more likely to negotiate on smaller items like window coverings or non-built-in appliances. It’s worth exploring what’s already included and what you can negotiate to personalize your home without significantly increasing the final price.
2. Financing Incentives
Builders often partner with preferred lenders and offer incentives for buyers who finance through these lenders. These incentives can help reduce your closing costs or provide credits towards items like HOA prepaids or loan origination fees.
One popular way to use this credit is to buy down your interest rate, which can lower your monthly mortgage payments. Be sure to compare the builder’s financing incentives against other lenders to ensure you’re getting the best possible deal, both on rates and closing costs.
3. Lot Premiums
Builders frequently charge premiums for more desirable lots, such as those with larger square footage, corner locations, views, or proximity to golf courses. However, in a market where there is an excess of inventory, you may have leverage to negotiate a lower premium or even avoid paying one altogether for a premium lot.
If you’ve got your eye on a specific lot, it doesn’t hurt to inquire whether the builder is willing to adjust the price or throw in additional incentives in exchange for choosing that lot.
4. Third-Party Inspections
While new construction homes come with warranties, it’s still a good idea to invest in a third-party inspection, especially at the pre-drywall stage. This can help identify issues that might be hidden once the walls are finished, such as electrical, plumbing, or structural concerns.
Negotiating the cost of these inspections is worth considering. Some builders may be willing to cover a portion of the expense or allow for flexibility in selecting the inspection company.
Conclusion
When buying a new construction home, you have opportunities to negotiate key elements that can affect both your immediate costs and long-term satisfaction with the home. Understanding your leverage and the areas where builders are more likely to offer flexibility—like options, financing, lot premiums, and third-party inspections—will put you in a strong position during negotiations.
If you’re considering a new build, it’s always helpful to work with an experienced real estate agent who can guide you through the process and advocate on your behalf to ensure you get the best deal possible.
-Dylan & Jenna
Marsh Real Estate Team