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Redfin's Free New Construction Class - Issaquah, WA
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Redfin's Free New Construction Class - Issaquah, WA

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    Redfin's Free New Construction Class - Issaquah, WA Redfin's Free New Construction Class - Issaquah, WA Presentation Transcript

    • Redfin’s New Construction Class Hosts: Janet Erickson, Tamaira Devany and Daria Kurkjy Redfin’s Issaquah – Sammamish Team February 25, 2014 Issaquah, WA @Redfin Facebook.com/Redfin Slide 1 of 33
    • Agenda ● ● ● ● ● ● ● ● ● Slide 2 of 33 Finding New Construction Pros & Cons New Construction Types Process Upgrades & Changes Negotiating Financing FAQ Q&A
    • A Little Bit About Redfin Redfin is a real estate brokerage on a mission to make buying and selling a home better for you. ● Accountability: we’re on your side, giving you honest advice ● Technology: sellers get more traffic; buyers tour homes first ● Value: a full-service brokerage that saves you thousands  No obligation  Get back a portion of the commission Slide 3 of 33
    • Your Agent. A Good Fit? Click here when you decide See all deals & reviews Slide 4 of 33
    • We Share Our Commission With You  Applied to closing costs  Refund is tax-free Slide 5 of 33
    • Finding New Construction Slide 6 of 33
    • How To Locate New Construction Slide 7 of 33
    • Is it a Home or Condo? ● Condo – Typically one floor attached or not attached. ● Town Home – Typically two floors and can be attached or stand alone home. ● Single Family – Stand alone home. What’s the difference? ● The way the property was developed. ● Costs for financing may be different, ask your lender. Slide 8 of 33
    • “Pre-Sale” or “Under Construction” Pictures from the MLS Slide 9 of 33
    • “Pre-Sale” or “Under Construction” Actually… Slide 10 of 33
    • Finding New Home Listings ● Builders may not list every home in a development on the MLS – your agent can inquire about other homes ● Notice of “Proposed Land Use” sign ● Builder websites, newspapers on Saturdays ● A neighborhood may become available in phases – sign up to be on a notification list with builder photo: vintageseattle.org Slide 11 of 33
    • Registration Policies ● Site Agents/Brokers may ask you to register your name especially if you visit the site without your broker. ● Some builders have Registration Policies that require broker to attend with buyer on the first or second visit. ● Commission and Redfin Rebate ● What should you do? Provide Broker information to site agent and carry Broker business card to show them. ● Let them know that your broker will be in touch with them as you may have questions. Slide 12 of 33
    • Builder Websites Local Builders • • • • • • • • • • • Slide 13 of 33 National Builders • • • • • • American Classic Buchan Homes Burnstead Conner JayMarc Homes Lozier Murray Franklin Select Homes, Inc. Polygon Quadrant Village Life Centex Homes - Pulte DR Horton Ichijo USA Lennar Pulte Homes Toll Bros / CamWest
    • Pros & Cons Slide 14 of 33
    • New Construction Pros ● Home built with “green materials” which saves you money and help the environment. ● Upgrades – you can pick your upgrades and colors. ● Pick the location in the community. ● Modern floor plans, open family and kitchen area, spacious closets and bonus/media rooms. ● Planned communities can include parks, new retails and planned infrastructure. ● Home Owner Associations help maintain value by having rules and regulations in place. ● It is all new and comes with warranties. Slide 15 of 33
    • New Construction Cons ● ● ● ● ● ● ● ● Smaller lot sizes depending on the community. Look the same or may lack character Price - Typically are more expensive Builders may not be negotiable on price, depending on market. Additional expenses, appliances, window screens or garage door openers may not be included. Long closing dates, pre-sale, can take a long time – up to 7 months, typically 4-5 mo. Landscaping isn’t mature yet. Builders may change the spec level, materials or prices. Slide 16 of 33
    • The Process Slide 17 of 33
    • How far along is it? • City permits • Most options for changes and upgrades • Longest timeline “Presale” Home Slide 18 of 33 Under Construction • Limited changes • Pick colors possibly • Timeline varies • No changes • Upgrades limited • Close quickly, like a resale home Completed “Spec” Home
    • Builder Contracts Builders have a package of documents: ● ● ● ● ● Builder addendum Full builder purchase agreement Neighborhood description documents Warranty information HOA documentation These are non-standard forms that will override standard purchase agreement documents and must be read carefully. Slide 19 of 33
    • Common Provisions ● No inspection contingency – inspections are allowed and builder must fix code issues but you can’t walk away. ● Builder walk through – “blue tape walk through or Home Orientation Tour (HOT)” to create a “punch list”. ● Closing delays – builder may automatically extend closing with no penalty if the process is delayed. ● Repairs after closing – builder may be allowed to finish things after closing within a certain timeline. ● Earnest money non-refundable – after a certain period your earnest money may go “hard”. Slide 20 of 33
    • Upgrades & Changes Slide 21 of 33
    • Specifications List Builders generally provide you: ● A standard list of specifications. ● A list of what upgrades which may be shown in the model home. ● Pre-built home – May include upgrades that were preselected and are included in the price of the home. Prior to writing a contract, builder may not have: ● A price list or master list of options you can choose from. ● A cost associated with quoting custom finishes. ● Limits on changes that they are willing to make. Slide 22 of 33
    • Paying For Upgrades Every builder has different rules: ● Roll it into the purchase price ● Upfront deposit. ● Some upgrade deposits may be nonrefundable. ● May be fees for getting quotes or making changes. Every builder has a deadline specific to a certain house after which changes cannot be made. Slide 23 of 33
    • Negotiating Slide 24 of 33
    • Front End vs. Back End Front End means on the purchase price: ● An offer of $540,000 on a list price of $550,000 a builder may not negotiate to maintain the value of the community. Back End means concessions or upgrades: ● An offer of $550,000 on a list price of $550,000 ● Asking for the builder to include upgrades or credits towards options or closing costs. Slide 25 of 33
    • What works best? Most builders prefer to negotiate on the back end. Why? ● Avoid setting a precedent of discounting for future sales ● Avoid upsetting prior purchasers who paid full price ● May be able to control material and labor costs The best approach varies case by case. Builders often have certain styles. An experienced agent can lay out your options and make a recommendation. Slide 26 of 33
    • Negotiation Factors ● ● ● ● ● Slide 27 of 33 Market demand Phase of construction Willingness to use a “preferred lender” Number of requested upgrades Style varies from builder to builder
    • Financing Slide 28 of 33
    • Preferred Lenders Many builders will have a relationship with a lender: ● Ownership – may be owned by the same parent company, or may just be an institution the builder likes. ● Concessions – certain “specials” may be linked to you agreeing to use the specific lender. ● Rates – usually comparable, maybe not the very best deal you can find, may have longer term rate lock products. ● Process – may be contractual provisions that are easier if you use the preferred lender. Slide 29 of 33
    • Questions? Slide 30 of 33
    • Thank you for attending! Redfin Hosts: Janet Erickson, janet.erickson@redfin.com Tamaira Devany, tamaira.devany@redfin.com Daria Kurkjy, daria.kurkjy@redfin.com Please fill out the survey. We’d love to get your feedback so we can improve our classes. We will also send you this slide deck. Check out our home buying guide: Redfin.com/home-buying-guide Check out our schedule of upcoming classes at Redfin.com/events Slide 31 of 33
    • Thanks for attending! Slide 32 of 33