Mar 19, 2021

Buying A New Home - Beware The Added Cost

In the old days when buying a new home there were very few options.  Normally, buyers could choose carpet and maybe some other flooring; but normally everything else was "standard".  Today, that is all different.  The base price of the home is just the starting point.  Builders have learned that they can increase their profits by allowing for all sorts of costly options starting with lot premiums.  So bigger, more desirable lots come at a higher price.

Once you sign on the dotted line, you will be sent to a design center to choose all your options.  Naturally, the models are loaded up.  They are not what you get for the base price.  If you want anything resembling the model, a good rule of thumb is that you will pay 20 - 25% of the base price to add all the options you want from cabinetry, built-in's, appliances, flooring, tiles etc.  And, in some areas basic landscaping in included in the price of the home.  In other areas, there is no landscaping or exterior hardscape.  Depending on the size of the lot, exterior landscaping expense can go from $50,000 to way more if you are planning a pool, outdoor kitchen etc. 

Buying a new home will cost 20 - 30% more than the same square footage in an existing home.  Of course, you will get an updated floor plan with all the options you choose, all new appliances, heating and air conditioning and most likely higher energy efficiency, but you will be paying for it.