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The pros and cons of building a house
By Riki Unrau
The new home construction market is surging in Cranbrook and all over Canada.
Last year, one in every three homes purchased was done so through a builder. This should come as no surprise. Who wouldn’t want to customize a house to be sculpted into their dream home? But, like all real estate transactions, one should always be aware of the possible pitfalls along that garden path leading to home ownership. Here are some tips to make you a savvier shopper.
Models are unrealistic
We’ve all been in those glossy, picture perfect model homes that make us salivate with envy. But like most models, appearances can be deceiving. Many prospective buyers often find their hopes dashed once they find out that nearly everything in the model home is an upgrade on top of the sticker price.
Since this is where the main profit margin for the builder comes into play, be aware that you will be offered everything including the kitchen sink (I never thought I’d be able to use that sentence literally). While some of these upgrades are a great investment as they will lead to a higher re-sale value, not everything is going to contribute. Be smart and really ask yourself if the upgrade at hand is a true asset.
Research the area
Despite the best of imaginations, sometimes it is hard visualize a home when it only exists in plan form. A great way around this is to visit some of the homes and neighborhoods the company has already built. If you’re feeling brave, knock on some doors and ask the residents how satisfied they are with their homes. Delighted or distraught they will more than likely want to fill you in on their experience.
Bring in the advisers
Never, and I repeat, NEVER enter into a contract without fully understanding it. Builder contracts can be a hefty pile of small print and legalese better left for the professionals. So, unless you study real estate law in your spare time, get some professional advice before you sign on that dotted line. You need to understand what is expected of you (i.e. When deposits are required, is it a draw mortgage, what is included/excluded, etc.) and what you can expect from the builder. If there is any part of the contract that confuses you make sure a qualified, unbiased party is the one to explain it to you.
Call in the inspector
Depending on your home warranty, you will have two or more home inspections. The first should be shortly before you take possession to ensure that the home is ready to take on its first inhabitants. If you notice anything problematic with the home at that time, take notes and make the builder sign off. Even the smallest problem can turn into a large issue later on. Best to take care of it as soon as possible.
The next inspection should be done after your home has taken a turn around the four seasons. This is where we see how well it stood up to Mother Nature and where the larger issues usually arise. Throughout the year a good idea is to take notes on non-immediate issues whenever they come up. This way you can provide the inspector with a list of concerns when the time comes.
Building a home can be a wonderful experience if you approach it with realistic expectations. Upgrades cost more, delays happen and issues arise but few things can guarantee perfection anyway. So long as you are an informed and educated buyer you will find the path to that new home much smoother to traverse.
– Riki Unrau is a Mortgage Broker with Invis Williams and Associates, located at 828C Baker Street, Cranbrook, BC V1C 1A2 – 250-919-6402. For more try: rikiunrau.com
