Things to Consider Before You Start Looking at New Construction

The current inventory shortage in the Denver Metro real estate market has many buyers opting to push out their timeline and look to new construction

The current inventory shortage in the Denver Metro real estate market has many buyers opting to push out their timeline and look to new construction. It is a great solution if you can be flexible. But it is important to be fully informed before you head out to home shop.
Advertised pricing is almost never the actual price of the property. What you commonly see advertised is the 'base' price of the floorplan. In addition to the base price, there are upgrades for the lot, structural upgrades, and design upgrades. Each builder has their own pricing model. Some builders are more tailored to customers who want a semi-custom experience, while other builders are all about efficiency (think design packages) and strive to be competitive on price. Either way, just know that when you see signs or online advertisements with 'starting at' you usually need to add anywhere from 10-50% to that number. 
Price is negotiable. While market conditions have a lot to do with how negotiable, there is almost always something that can be done in terms of price, concessions, upgrades or closing credits. Especially when looking at inventory that is currently in construction or completed. It pays to work with a Realtor who is familiar with the Builder and can negotiate with them on your behalf. 
There is such a thing as 'quick move-in inventory that is not advertised on consumer-facing real estate websites like Zillow. These are homes that are currently under construction and will be completed within 1 - 4 months. There are also homes that may be under construction that aren't 'released' yet, which means the builder is strategically holding back inventory so they can gauge the market and potentially raise prices. 
Real estate agents that have relationships with the builders can do the leg work for you and get you the relevant inventory lists based on your price point and criteria and they can even get the scoop on homes that will soon be released. 
New construction as an investment is not as straightforward as resale homes in established neighborhoods. The resale value of your recently built home and the amount of equity you accrue is impacted by what phase the development is in, future commercial and residential development plans in the area, the price of lumber and so many other factors. New construction also is often in a special taxing district. Be sure to work with your agent to really understand the subdivision and surrounding area to evaluate the investment opportunity.
Be sure to reach out to your agent before you start visiting model homes. In order for your agent to be able to represent you as your advocate and ally, they need to register you as their client with the builder the very first time you visit the community. Looking at model homes can be fun, just make sure you have the representation you need to get a great deal and land your dream home!

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