Now that you’ve chosen the design options for your new home, it’s time for the professionals to take over and begin making your dream a reality. Whether you work with a production builder or a custom builder, the transformation of the dirt on your lot and the blueprint of your floor plan into a foundation, walls, plumbing and electrical systems, and all of the finishing touches takes a team of professionals.
If you’re building a custom home, you’ve probably already been working with an architect and a builder to develop your individualized plan for your home. If you’ve bought land within a development of custom homes, you may already have met the developer, too, and if you purchased a private lot, you may have been interacting with an engineer to study what it will take to provide utilities, a septic system, and a driveway to your land before the home can be built.
Buyers of production homes typically interact mostly with the new home community’s sales staff and design center staff and may not even meet everyone who works on their home. Eventually, you’re likely to connect with the site supervisor or construction superintendent who is responsible for the building of your home, but in the meantime you may want to know who else has a role to play in creating your residence.
Who’s Who of the Construction Site
Whether your home is in a large master-planned community with hundreds of homes or a smaller development with a handful of homes, the evolution of the neighborhood from raw land to a residential area started with a developer. The same is true if the community was previously a commercial site or had other homes that were purchased and demolished to make room for new homes. Developers sometimes spend years searching for land, working to comply with zoning issues and preparing the land for development.
Depending on the size of the community, the developer will create plans for amenities. Every community needs to have a land plan for infrastructure such as utilities and sewer and water lines, followed by a plan for roads, sidewalks, street signs, and fire hydrants. The developer also has to decide the type of homes to be built and the size of each lot before getting zoning approval and possibly approval from the local school district if the community will add a significant school-age population to the area.
Unless you’re building a completely custom home, you’re not likely to meet the architect of your home. That doesn’t mean, though, that an architect wasn’t involved with the design of your home. For example, at Schumacher Homes, buyers will find hundreds of floor plans from a variety of talented architects. Ryland Homes, one of the largest builders in the country, works with local architects in different markets to develop designs that match local tastes.
The size of your builder’s staff depends on the size of the building company. Many smaller or regional builders are family-owned businesses with several generations involved, such as Jim Chapman Communities in Atlanta or McCaffrey Homes in California. Larger builders may have both national and regional offices in addition to their local developments and design centers. If you work with a smaller builder, you may have direct contact with the company’s owner, but regardless, you will get to meet several members of the builder’s team.
The Sales Consultant or Associate
A builder’s sales professionals are educated not only in the specifics of the development where they’re working, but also about the process of building a new home. Some may also be licensed Realtors.
The Design Center Consultant
While some design center consultants may be licensed interior designers, all are trained to help buyers make multiple decisions on how their finished home will function and look.
The Construction Manager
The person in this position could have one of several titles such as site supervisor, site superintendent, project manager or even just “builder.” This person won’t necessarily do hands-on construction of your home but will be responsible for overseeing the entire project from permitting to inspections and construction. You’ll need to rely on the construction manager to show you the house while it’s being built and to answer any questions or concerns you have; however, you can also address questions to your sales consultants at any time, too.
Your builder will either hire outside contractors or rely on staff contractors to build your home from the foundation (and basement if you have one) through the framing, plumbing and electrical work, drywall installation, interior work, cabinet and counter installation, and beyond. You won’t necessarily meet any of these contractors, but if you’ve carefully chosen a reliable builder, you can also feel confident that your builder has hired the best available contractors.
Your home will be inspected multiple times while it’s under construction by your builder’s inspectors and county or city inspectors. You can discuss with your construction manager, or site superintendent, whether you can or should attend any of these inspections.
How Your Home Gets Built
Regardless of your home’s size and complexity, the basic process of building a home is the same. Here we outline the primary steps that your home’s construction will take.
Before a builder can put a shovel in the ground, the city or county government must approve the design and provide permits for everything from the zoning and grading (changing the contour of the land to accommodate your home and driveway) to the septic systems, home construction, electrical work, and plumbing. Some builders are able to speed the permit process by limiting exterior structural changes to their home designs, but the time it takes to get permits depends on the speed of the government entity that provides them. Ideally, says Angel Boales, a sales associate with Meritage Homes in Roanoke, Texas, the builder is ordering materials and lining up contractors while waiting on the permits.
Before anything can be built, a site needs to be cleared for construction by having trees, rocks, and debris removed and the ground leveled where your home will be built. Some or all of this preparation may already have been done if you’re buying a home in a masterplanned community.
The method for pouring your foundation may vary depending on whether your plans call for a basement; either way, footings are dug and concrete is poured into the holes and trenches of your foundation walls. There will be a “curing” period for this concrete when no work will be done on your home, followed by the application of a waterproof membrane and the installation of drains, pipes, and plumbing for your basement or first floor.
The “shell” or “skeleton” of your home goes up next, including subflooring, the walls, and the roof. Plywood or “oriented strand board,” which is engineered wood particle board, is used for the exterior walls and roof, and your windows and exterior doors will be installed at this time as well. Next, a house wrap will be installed to prevent water from infiltrating your home while allowing water vapor to escape.
Siding and Roofing Installed
After the framing is complete, your roof and siding choice can be installed. Different exterior materials are popular in various areas, but in this initial construction phase the underpinnings of your eventual façade are installed. Popular roof materials include slate, tile, metal and shingles.
Plumbing, Electrical and HVAC Installed
At the same time, other contractors will begin installing ductwork for your heating, ventilation, and air conditioning (HVAC) system, and the plumbers and electricians will start putting pipes and wires into your interior walls. Big plumbing items such as your tub and shower will be placed in your bathrooms before the interior walls are completed to make them easier to move. After the roof is complete, the electrician will start putting in receptacles and outlets and running wires to the breaker panel.
The insulation your builder uses depends on the climate where you live, but homes typically have insulation installed in all exterior walls, the attic, and floors that are located above a basement or a crawl space. Insulation is given an “R-value” to indicate how well it protects the inside of your home from heat and cold. Your builder is likely to use blanket insulation as well as loose-fill and blown-in insulation to provide a high level of comfort and energy efficiency in your new home.
Install Drywall and Exterior Finishes
After the electricians and plumbers have done their work inside your walls, drywall can be installed, taped, and covered with a primer coat of paint. Brick, stone, stucco, or siding (vinyl, metal or cement) will be installed on the exterior of your home at this point.
Interior Trim and Exterior Walkways Completed
The next step is to install trim throughout your home, including baseboards, moldings, window sills, doors, door casings, and stair railings. Your cabinets, vanities, fireplace mantel, and any decorative trim will be installed at this time, and your walls will be painted or wallpapered per your request. Outside, your driveway will be formed — unless the builder chose to do this at an earlier point — along with your walkways and patio.
Floors, Countertops, and Exterior Work Nearly Complete
Your hardwood or tile flooring goes in next, along with your bathroom and kitchen counters and other tile work. If you’re having vinyl flooring or carpet installed, that will be done later. Outside, your yard will be prepared for proper drainage and future landscaping.
Mechanical Work Completed; Fixtures Installed
Your light fixtures, outlets, switch plates, and HVAC are installed, along with your sinks, faucets, and toilets.
The last step is installing carpeting, vinyl flooring, mirrors, and shower doors, followed by a thorough clean-up of any construction debris. Your exterior landscape, including any grass or trees, will be prepped and planted.
The Building Timeline
A production home typically takes from five to seven months to complete, while a custom home can take up to a year or more, not counting the design and permitting phase. The length of time it ultimately takes depends on multiple factors including the size and complexity of your design, the availability of labor and materials, whether your site has already been prepared for building, and even the weather. If you choose a particular cabinet that happens to be out of stock or are unlucky enough to have a hurricane, blizzard, or tornado hit the area where your home is under construction, it’s possible that you’ll have to wait a little longer for move-in day.
Your builder can give you a good sense of the progress being made on your home while it’s under construction, but one of the first reasons for a delay could be a slow permitting process.
“Building normally starts within thirty to forty-five days of a contract signing depending on the permit process, the weather, and availability of materials and labor,” says Meritage Homes’ Angel Boales.
Once construction has begun, the timeline depends on what you’ve chosen to have built. If, for example, you’ve chosen a relatively small home, stuck to the originally designed floor plan, and have declined to add extensive custom-made trim or tile work, your home is much likelier to be completed within six months or so compared to a buyer who has opted for a fresco to be painted on one wall, mosaic tiles in each bath, a spa bath with curved glass walls, and hand-carved filigrees on the stair rails.
If you are as eager as most buyers are to move into your new home, you can help keep your builder on track by avoiding change orders. Your builder asked you to make your choices for structural options at the time you signed the contract or within a short time period after that date, and then gave you a second deadline for your interior choices. If you decide when your home is half-built that you want to add a sunroom or redesign your kitchen layout, you may not necessarily be able to make that change. Even if you can, there’s no question that making changes will slow the building process while the builder obtains new permits and brings back the plumber and electrician and other contractors. Cosmetic changes such as picking new cabinets may seem like less of a big deal, but your builder has to order these materials and this could also cause a delay.
Not only can change orders delay construction, but they also can add to the cost of your home. This is why builders spend so much time, energy, and money on developing robust websites and training consultants to help you make a good (and final) decision from the beginning.
Inspections and Visits
Several inspections of your home will be conducted at various stages of construction by city or county inspectors. These are usually done without the buyer being present, says Dennis Webb, vice president of operations for Fulton Homes in Tempe, Arizona, but your builder will be in attendance.
After the foundation has been poured and cured, an inspection must be done to make sure the work meets the local code of building standards before additional work can be done.
Once your framing is in place, an inspection must be done before your drywall goes up to make sure that everything inside your walls has been built according to the permits and code.
Third and Fourth Inspection
In some jurisdictions, inspections are done simultaneously on your plumbing, electrical, and mechanical systems.
Before you are allowed to move into your home, your builder must obtain a Certificate of Occupancy based on a final inspection by your city or county government authority.
Ask your builder about which of these inspections you can attend. It’s a good idea to follow along so you can see what’s being inspected and understand what’s behind your walls. Many builders also schedule a walk-through for buyers early in the construction process for this purpose — as well as a final walk-through for buyers shortly before you close on your home.
“Once your framing is up but before the drywall is installed, buyers should do a walk-through with the project manager to go over all of the options again and to check out the wiring to make sure it’s what the buyers requested,” Webb says.
You should expect to spend an hour or two at this pre-drywall inspection. You may want to bring along a notebook and some paperwork, such as information about the selections you made including both standard and optional features, along with a diagram if you have one of where you want to install your telephone jacks, cable outlets, and electrical outlets. Your Realtor, if you’re using one, should also attend the inspection.
Seeing your home being built is an exciting experience, and it can be hard not to want to be on site every day. But, it’s important to adhere to your builder’s rules about when you can visit the construction site. Instead, make the most of the times when you are able to check on the progress on your home.
“I’ve bought several new homes and had a custom home built and my main piece of advice,” says Leslie Finn, a buyer at Brookhaven at Johns Creek, “ is watch the progress of the building and make sure even little things like phone jacks are put in the right place.”
When visiting, it’s important to respect the time of the workers who are building your home and not to interfere with them. In addition to safety issues, keep in mind that the builder (and not you) owns the home during construction and is responsible for the job site and home until closing. That’s why it’s best to visit at the specific intervals called for in your agreement. That allows you to satisfy yourself that everything is being done to your contract’s specifications.
Should You Get a Third-Party Inspection?
If you’ve purchased an existing home in the past, you probably had a home inspection on the property before you finalized your contract. Most homebuyers opt for a home inspection on a resale home so that they can find out the condition of the home’s systems and appliances and to find out if there are any costly repairs to make. While most buyers make their purchase offer for a resale property contingent on the outcome of a home inspection, even buyers who want to make a non-contingent offer on a home sometimes choose an “information only” inspection to learn more about the home they’ve purchased and how to operate it, as well as to budget for future home repairs.
Now that you’re buying a new home, you may be wondering whether you should hire a third-party home inspector for your newly built residence. Clearly you don’t need information about the age and condition of your appliances or systems — they’re all new. As you learned above, your builder and your local jurisdiction will make multiple inspections to see that your home is being built according to regulations. In fact, a new home will have to meet the latest building codes, which are likely to be at a higher standard than those under which older resale home were built. Regardless, you may still want to have your own inspection done.
“I always recommend that buyers hire a third-party inspector on a new home so that they have an extra person to review the construction and to check to see if any mistakes have been made,” says Raylene Lewis, a Realtor in College Station, Texas. “It’s good to have another professional opinion to help you decide if you need to ask your builder to make any minor repairs and to make sure no one has forgotten something like insulation in the attic.”
The decision to hire a third-party inspector on a new home is entirely personal, but many buyers find that for peace of mind they prefer to have an outside opinion in addition to the inspections handled by the builder’s staff and government employees. Depending on your location and the size of your home, a home inspection will cost $250 to $400.
If you choose to hire an outside inspector to supplement the other inspections on your home, it’s best to schedule that inspection within a few days before your closing so that your home is complete or nearly complete and your builder has time to make any required repairs. Since your builder owns the home until closing and is responsible for safety and security on the construction site, your builder will set an agreed time for the inspection and likely require that a representative of their company accompany the inspector during the appointment. You should definitely plan to attend this inspection, too. Your builder will want to see a copy of the home inspector’s report when you receive your copy.
The Quiet Period
Don’t ignore the so-called quiet period. This is after you get approved for a mortgage, but before you close on your new home.
Communicate Often With Your Builder and Realtor
By the time your home is under construction, you should have a thoroughly established relationship with your builder and know who to contact with questions. There’s no need for a daily check-in on progress, but you should periodically email or call your sales consultant or project manager to find out the status of the project. Some builders have systems that allow you to check progress on the home through their website. If you’ve been working with a real estate agent, discuss whether you or your agent should be responsible for following up with the builder.
There are several reasons to stay in touch with your builder, including the need to know when to lock in your mortgage loan. Your builder should alert you if there are any delays caused by the weather or materials and let you know if any of the fixtures or finishing products you chose need to be changed to keep construction on track. It’s wise for you to proactively check on this, too, as not all builders have a large staff that can consistently follow up with every buyer. You’ll need to have a firm idea of when your home will be complete to arrange for a moving company and to begin packing.
Decide When to Sell Your Home
If you’re a first-time buyer you can safely skip on to the next point, but if you own a home now, you’ll need to develop a plan for it and moving into the new one. Most people prefer not to move more than once, so you’ll need to time your home sale carefully to closely match the settlement on your current home with the settlement on your new residence.
“I made the mistake of selling my home too quickly and I had to live with one of my kids for two months and have everything in storage,” Brookhaven at Johns Creek resident Leslie Finn says. “If you can plan it better, that would be best, but the market took me by surprise and my house sold faster than I expected.”
While your next home is under construction, you should begin preparing your current home for sale and start interviewing listing agents. Once you’ve chosen one, you should determine when to put your home up for sale in consultation with your agent. A lot depends on your local market conditions as well as the prognosis for how soon your home will sell. Sometimes you can negotiate with your buyers to rent back your home for up to sixty days while waiting for your home to be completed.
Maintain or Improve Your Credit Profile
In addition to communicating with your builder and real estate agent, it’s important that you stay in touch with your lender. Even though you’ve been preapproved for your financing, your lender will need to do a final credit check and re-verify your employment just before you go to settlement on your new home.
“A lot of buyers think that once they have a preapproval, their loan is a slam dunk, but you have to remember that those preapprovals expire,” says Paul Erhardt, senior vice president of homebuilding and development for WCI Communities. “You should stay in close touch with your lender the entire time while your home is being built, but especially about two months before it’s ready because you made need to do some extra paperwork before you can close the loan.”
It’s a little easier for buyers of existing homes to keep their credit profiles intact while waiting to go to closing because the typical time frame from a purchase option on a resale to the closing is thirty to sixty days rather than six months or more as it is for a new home.
“While you’re waiting, keep your status quo or improve your credit,” says Phyllis Casillas, with On Q Financial. “Don’t take on new debt and consult with your lender before making any big decisions or financial changes.”
If you do change jobs, talk to your lender about your situation and make sure that you’ll have at least two paystubs in hand before the closing on your new home. Don’t get a new car or even apply for additional credit before your home is built because this could lower your credit score or increase your debt-to-income ratio beyond the maximum allowable amount. Be careful to pay your bills on time, of course. And don’t close any credit accounts; that, too, could harm your credit score.
“You have a longer period of time to get in an even better position financially while waiting for a home to be built,” Casillas says. “You should use the time to save more for a bigger down payment or to replenish your cash reserves, pay down any debt, and live frugally so that you’ll be able to comfortably afford your new home.”
At some point during the construction period, you should consult with your lender on when to lock in your mortgage rate so final preparations can be made for your purchase.
What to Expect During Your Final Walk-Through
Your final walk-through and home orientation is one of the most exciting days of the entire experience of building a new home, takes place just before your settlement day. Many builders deliberately schedule this a few days before your closing to have time to fix any minor details. If you hired a third-party inspector and any issues were found with the house, make sure that they have been addressed at your walk-through. You and your construction supervisor or perhaps the sales consultant will go over every inch of your home and identify any flaws that need correcting, such as a screw missing from a switch plate or a piece of trim that accidentally didn’t get painted. You’ll still be able to ask to have flaws fixed even after you move in, unlike with a resale purchase where you’re personally responsible for everything as soon as the closing takes place. The majority of builders want your home to be as close to perfect as possible before you take ownership. For most builders, it’s a matter of pride in their product to inspect the quality of their work before handing the keys to the new owners.
Some builders opt to have a pre-walk-through inspection of their own before the final walkthrough with their buyers.
“Our homeowner orientation session with the site superintendent takes place after we have someone who’s not been directly involved with building a particular house go through and mark any flaws that need to be corrected with blue painter’s tape,” says Tim Rini, vice president of Epcon Communities Franchising in Dublin, Ohio. “Once those flaws have been fixed, the buyers are brought in and given time to look through the house and given instructions about how to maintain and operate all the systems and appliances in the home.”
Your walk-through should take at least two hours or longer because it’s an opportunity to learn as much as you can about your new home.
What’s Your Warranty Worth?
One of the many advantages of buying a newly built home is that your appliances and systems are covered by a warranty for a particular amount of time. Be sure you register everything that needs to be registered for the warranty to be valid. In addition to manufacturers’ warranties on appliances, your builder will provide a warranty for the company’s work, too.
Buyers of existing homes can purchase a home warranty, but those warranties are far different from the warranties that come with a newly built home. Existing home warranties are usually purchased for just one year and can be renewable, but they only cover your systems and appliances and not your home’s structure. In addition, home warranties on an existing home have service fees and limits.
According to the Federal Trade Commission, new home builders typically provide a warranty for workmanship and materials for most components of the house for one year, including items such as siding, drywall, and paint. Coverage for HVAC, plumbing, and electrical systems generally is extended for two years and coverage for structural defects is provided for ten years.
“According to state regulations, all builders offer an implied warranty on their homes regardless of whether they also offer a written warranty,” says Emily Portocarrero, new home marketing manager for 2-10 Homebuyers Warranty. “The implied warranty means that builders are held responsible for repairing their work for a certain period, such as ten years. Without written documentation, homeowners must go to a legal resolution of a dispute if the builder doesn’t live up to the implied warranty.”
Understanding Escrow and Deposits
In addition to reviewing your warranties and keeping an eye on the progress of your home’s construction, you’re likely to have a financial obligation during the period your home is being built. While every builder is likely to have a slightly different way of handling the financial side of buying a home, most require at least one deposit prior to the settlement.
When you buy an existing home, you typically provide an earnest money deposit when you make an offer. That deposit is held in escrow until the closing date, so that if the transaction falls through, you can usually get the money back depending on the circumstances. If you end up buying the house, your earnest money deposit is credited toward your down payment.
When you buy a new home, you usually make an initial deposit for $1,000 or so to hold a lot, says Brian Koss, executive vice president of Mortgage Network in Danvers, Massachusetts. “After that, you make another deposit of 3 percent to 5 percent of the sales price when you sign the purchase agreement. All of those deposits go toward your down payment,” he says.
According to Koss, some builders may require an additional deposit from buyers who choose numerous options. Some builders require deposits at several points during the construction process.
“You’ll find that a lot of builders do things differently, but basically, most have a graduated plan like ours at Fulton Homes,” Dennis Webb says. “For instance, on a $300,000 home, we ask for $1,000 at the initial contract signing, of which $500 is refundable if the contract is cancelled within ten days. Then we get 1 percent ($3,000 in this case) when the buyers choose their structural options because that’s when we apply for the permit and establish the footprint of the house. We ask for 1 percent more when they make their choices at the design center and 1 percent again after the framing, which is usually about six weeks before the closing.”
For more expert advice on buying and building a home, check out the free eBook download of New Home 101: Your guide to Buying and Building a New Home at NewHomeSource.com.