Today, I am sharing our home progress and our experience so far with buying a new build home. I’ll be answering a lot of questions I got from Instagram as well as questions you may have in case you’re thinking about buying a new build home in 2021 or beyond!
But before we get into that, I want to first give you a little background.
WHERE WE ARE RIGHT NOW
We are a family of six. I am a stay-at-home mom of four and we live off my husband’s single income. Currently, we live in a 3-bedroom apartment and we’ve been renting for nearly five years.
But this is not the first home we’ve owned.
Back in 2013, we built a condo. At that time, I had a full-time job and we had only one child. Then, when we were expecting our second, Ryheem and I decided it was best I stay at home with both of our boys.
Transitioning from a two-income to a one-income family was tough. We had to cut a lot of things out of our spending and downsize where we lived too. So we sold that condo after three years and have been renting ever since.
It was not our plan to be renting this long, but our family continued to grow and it was much more affordable for us to rent than buy (I know, you don’t hear people say that often).
It wasn’t until last Fall that Ryheem landed a higher paying job, and, all of the sudden, homeownership seemed possible.
WHY WE DECIDED TO BUILD (again)
Honestly? The market made us do it.
When my husband found out we were in the position to buy, I was 100% sold on the idea of finding a move-in-ready, newly upgraded, existing property with a fully fenced-in backyard, basement for storage, and get it for $15,000-$20,000 below asking price.
But this isn’t HGTV.
Long story short, 2020 turned the housing market into a Seller’s market. There are more people wanting to buy a home than there are actual homes available for sale.
Plus, the pandemic caused mortgage rates to drop at an all-time low making it super affordable for almost anyone to own a home. All of this makes the competition STIFF.
I mean, buyers are throwing in PS5’s to desperate parents just to get their offers accepted. 🤯
So even though we had the patience to “wait” for our perfect home to hit the market, we didn’t have the money to really compete against other bidders for it.
My biggest fear was falling in love with a home I couldn’t have.
Maybe I was being overly cautious, but I know emotionally, I couldn’t go through that disappointment again and again.
THE PROS AND CONS OF BUILDING A NEW HOME
One of the BEST things about building a home is that you don’t have to worry about any competition. There aren’t any bidding wars to deal with, so you’ll have peace of mind knowing that no one can steal your house from underneath you.
The second thing I love about buying a new build home is that it’s (almost) custom. You can select all of the fixtures and finishes you want from top to bottom. It’s extensive, but so much fun!
Last, I think the biggest reason people are afraid to own a home is that they’re afraid of the maintenance. And that feeling is 100% valid because let me tell you: a leaking roof or discovering mold behind a wall IS scary and very expensive to repair.
Owning a new build home is reassuring because everything inside is BRAND NEW! You’ll sleep well at night knowing you’ve got plenty of time to save up for those unexpected home repairs that tend to happen waaaaay down the road!
That said, buying a new build home isn’t always peaches and roses.
There are some cons to consider before taking the leap:
#1 You could end up with a smaller lot. It makes me sad that builders are building communities with homes right on top of each other. Nobody wants to shake hands with their neighbor FROM THE DRIVEWAY!!!
It’s really ridiculous if you ask me and kind of sucks the joy of homeownership right out of you. Especially if you’ve always wanted a big yard — that’s the American Dream, right?
#2 You will end up living in an HOA (Homeowners Association) community that will control what you can and cannot do to the outside of your property. It’s literally the difference between how high your privacy fence can be, the location of your mailbox, and whether or not you’re responsible for your own yard work. All of which could have you feeling less like you own your home and more like you’re renting it.
And it’s becoming harder to find homes on the market these days that aren’t governed by an HOA, which is the main reason why competition is so stiff. We ALL want as much bang for our buck!
#3 It may cost you MORE in parts and labor to make your brand new house “feel” like home. One of the biggest things most people complain about with new builds is how plain they often look and feel on the inside. All of those builder-grade features can make your home look flat and lack character.
You really only have two options: a) pay your builder to make it pretty, or b) wait until you move in to do small upgrades yourself over time.
And speaking of upgrades, that brings me to the question I know a lot of people have. Because when you’re building a home, most of your money goes towards upgrades.
WHICH NEW BUILD UPGRADES ARE WORTH IT?
In my opinion, there are six areas I think are worth splurging on:
- Flooring – if you have pets or little ones, you need to upgrade your carpet. What comes standard in most new build homes is so thin and cheap that you won’t even find them in most apartments. What’s better is if you can afford to upgrade to vinyl planks. It’s expensive, but it will last you YEARS!
- Ceilings and Windows because they will make a HUGE difference in your home! These are things you cannot ever change so if you want your home to feel bigger, invest in taller ceilings. And then, add as many windows as you can if you love natural lighting as much as I do!
- Overall Layout – you should definitely check with your builder to see what options your floor plan will allow! Sometimes you can make changes to the layout that you never thought were possible. For example, maybe you can turn a loft into a guest bedroom with an ensuite bathroom. Or turn your formal living space into a private office. Remember: you don’t have to build your home just like the model.
- Electric Outlets and Lighting is worth investing in too, although you can always hire an electrician to do whatever you want to your house later. I think it’s easier (and probably cheaper) to make these decisions now. We upgraded our outlets in our living and master bedroom. We will have an outlet in the center of both walls so we can mount a tv without having to hide any cords!
- Cabinets & Countertops is another thing you could always swap out later. But who wants to do that, right? What matters most here is not the way it looks, but the material it is made from. So you’ll want to be thinking about what you can live with (or without!) when you start making your selections.
- Lifestyle Features: Think double vanity sinks, soaker tubs; upgrades you’d love to have in your home to make your life easier!
Now, here are all the new build upgrades I think you can skip to save extra money: light fixtures, hardware finishes, backsplash, paint, and appliances (if they’re not already included) — none of these decisions you make today will last forever anyways!
HOW LONG DOES IT TAKE TO BUILD A HOME?
In a nutshell, the entire home building process for most houses can take up to six months. Larger size homes can take nine months to a year!
I’ve created this image to show you the overall process for buying a new build home. Everyone’s experience is different, but this is pretty typical. If you want to print this off, you can download the PDF here!
Many people may not know that you don’t have to use the builder’s mortgage company. You are free to use whichever lender you’d like! Although, if you do, your builder may offer to cover some of your closing costs.
HOW CAN I QUALIFY TO BUY A HOME?
According to LendingTree, if you’re a first-time home buyer applying for an FHA loan, minimum mortgage requirements for 2021 include:
- 580 credit score
- 3.5% down payment
- 31% front-end DTI (debt-to-income) ratio
You should read this article for more information. It covers everything in great detail.
But THIS really is the first step: seeing if your credit qualifies. And if it does, that’s great! You’re one step closer to owning a home!
CAN I DO THIS WITH ONE INCOME?
I am not a loan officer, so the advice I am about to give here is strictly for informational purposes and based on my own personal experience. Should you have more questions, I highly recommend reaching out to someone qualified to help you.
Now that we got that out of the way…YES!
And our family is the perfect example of this — we’re building our home entirely on my husband’s income and credit since he’s the breadwinner.
Of course, if I had some income to contribute, we would’ve been able to put a lot more money into our new build home, but I am grateful anyway.
WILL I NEED A REALTOR?
We had a realtor for two weeks while we were deciding whether to build or buy something on the market. She tried her hardest to find us a home on the market, but every time she sent us a property to look at ONLINE, it was already under contract before we could open the email. 😑
So we fired her.
At this point, we had visited more model homes than we could count, we narrowed down our preferred builder and floor plan, all that was left to do was go under contract! And that’s a transaction that happens between you and the builder — you won’t need a realtor for that.
But, if you really want to house hunt the old-fashioned way, that’s where having a good realtor can help. And, of course, if you have a home to sell. Other than that, you honestly don’t need a realtor to buy a new build home.
SHOULD I BUY OR BUILD MY FIRST HOME?
That’s a hard question. I know for us, I went into this process thoroughly weighing both of our options.
The competitive market…
The long waiting period...
There are pros and cons to both. It’s important to weigh them all.
Buying a home is a really big decision! The best thing you can do is keep an open mind.
Don’t fall in love with the first house or floor plan you see and don’t be afraid to shop around for better mortgage rates too.
I hope that sharing our home-building experience has helped you in some way. And if you’re not in the position to buy a house yet, don’t get discouraged!
You can’t compare your start to someone else’s finish because you have no idea what it took for them to get there. So start saving, build your credit, and keep the faith!