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Get ready for new construction costs

Are you planning to buy a newly constructed or custom-built home? It's an appealing idea for many reasons, not the least of which is the enjoyment that comes with being the first owner of the property. Depending on the status of construction at the time you commit to purchase, you may be able to make important choices that truly make the home unique.

Some home buyers believe they avoid some financial pitfalls of older homes when buying new. But beware that there are factors to consider with new homes that can have a significant impact on your budget.


Throughout the building process, you may encounter a variety of upgrade choices that lead to increased costs. Keep track or you could go over budget faster than you can say mosaic backsplash.

Fixtures, appliances and window treatments

It's important to understand just exactly what is included in the final price of your new construction and what is not. Basic appliances are likely part of the deal, but window treatments most likely are not. Choosing fixtures you want rather than basic ones included in the package may cost more.

Muddy lawn

Chances are you'll take possession of your new home before landscaping is completed. Depending on your location and the season you move in, you could wait several months for sod installation. If your building agreement includes an allowance for landscaping, it may not cover all the costs.

New Home Image

Details, details, details

Be ready to make decisions and second-guess yourself throughout the building process. You may come unhinged picking cabinet hardware or look at enough carpet samples to cover the globe. Buy a new pre-built home and avoid endless decision-making.


New homes are generally more energy efficient, but be prepared to pay more too. Larger homes cost more to heat and cool. Also, switching utility providers could change the rates you pay. Be sure to understand that major appliances using gas or electricity could have an impact on utility costs.

Property taxes

If you are moving into a new neighborhood in a different community, you may only have an estimate of what annual property taxes will cost.

Fences, patios and decks

Take your time deciding how to finish your new property. For instance, a basic deck may seem adequate, but live in your new home for a while, and you may decide a screened porch is essential to keep mosquitoes and other insects from bugging you.

Mind the mortgage

New construction takes time, and delays occur. It can take three to nine months or more from signed purchase agreement to finished construction. Since your lender will need current proof of employment and more, documents required for mortgage approval may need to be resubmitted before closing. Be prepared with current pay stubs and bank statements. It's important to avoid major purchases that could affect your credit rating during this timeframe as well. Watch a short video (3.5 min.) on how our mortgage process works.