Why Buying a New Home is an Excellent Investment Opportunity.

February 25, 2010

Big ticket purchases can either increase or decrease in value over time. Take, for instance, buying a new car – one of the worst investment opportunities. A buyer may purchase a new car for $35,000 and drive it right off the lot, feeling pretty good about their investment, lured into a trance, perhaps by that new-car smell. After all, he received a 3-year, 36,000-mile warranty and a 7-year, 100,000-mile engine guarantee. To the buyer, this equates to no repair bills for at least the next three years, compared to possible headaches and necessary repairs if he had purchased a used model. But what about the resale value? Some cars may depreciate as much as 35% the minute they are driven off the lot.

Buying a new home versus a “trade-in” provides buyers with an excellent investment opportunity. Unlike new cars, new homes appreciate over time. Buying a new home makes good business sense. Buyers have the ability to work with builders during the construction phase to include upgrades and landscaping that will increase the value of the home over the long-term. In the future, homeowners may be able to sell their investments for more than $50,000 over its original value. Appreciation will vary, depending on how long the buyer plans to live in the new home before selling. But for example, a home we built for a new homeowner 10 years ago just went on the market and sold for twice its value from a decade ago. When it comes real estate investment, it’s clear that buying a new home makes smart business sense.

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Finding a New Home Gets a Bit Tougher

February 17, 2010

With all the “For Sale” signs we’ve seen curbside over the course of the last year, it’s hard to believe we’re even talking about a home shortage—but it actually could happen with new home sales. For buyers who have been saving for years to purchase their brand-new or custom-built dream home, the housing pool could be shrinking. That means buyers will pay higher prices for the new homes that are available.

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Recent federal regulators have made it more difficult for builders to secure loans to build new homes. Federal guidelines are tightening the screws on banks, suggesting they restrict commercial loans to less than 300% of total capacity. The guidelines were never adopted; however, banks still feel the pressure, to the point where they require home builders to pay off loans instead of refinancing.

So what does this mean to you, the buyer looking for a new home? New homes are being sold quicker than they can be built because of the banks’ stringent lending policies. If you want to have your chance at the best selection of new homes available, now is the time to buy.


The new home smell

February 10, 2010

I love the smell of “new”. The new car smell, a fresh coat of paint on a wall, and a new-mown lawn are as tantalizing as bread baking in the oven. If a candle company could effectively simulate these fragrances, I’d buy stock in the company.

And I particularly like walking into a brand new home where no one has lived yet. There are no other memories in these rooms, no pencil marks on the doorways to gauge someone else’s child’s growth, and no indentations in the carpet where their furniture remained in place for too many years. The walls have no stray picture hooks and if I move the refrigerator, I know I won’t find a note or picture that fell from the magnet that had once held it in place on the fridge door. The appliances are fresh from the store, and the cupboards are free of stray bits that the previous homeowner left behind. There are no signs that this house was once a home for another person—because it wasn’t!

A new home is a blank canvas on which to paint your own masterpiece, one stroke at a time. You don’t need to erase the marks left by another artist. And your artwork becomes an even more a personal statement because you have the opportunity to customize your floor plan, choose your windows and doors, and personalize every detail. Think of all the hours you save in making changes to get your house the way you want it. I’d rather spend that time instead making memories, instead of changes.


How to Start Designing Your Dream Home

February 3, 2010

We all have visions of our dream home. Maybe you’re watching a home makeover on television and think, “I want that!” or you visit a friend’s home and are impressed by a renovation. Or perhaps you’re tired of having your laundry room in the basement and swear “never again” every time you lug another load of clothes up another flight of stairs.

Having a dream and realizing it are two, very different things. Before you talk to a builder or architect, here are a few tips to get you started in the right direction:

  1. Build a Vision Book. You probably know what you want—and what you don’t. Start a notebook and write down your likes and dislikes. Clip out photos and ideas from magazines, print from the Web, or take photos yourself. Circle architectural details you like, such as windows, doors, trim, entryways, flooring, built-ins, porches, decks, etc.
  2. Determine the size. Figure out the rooms you want and need, the size of each, and how many levels. Do you want a great room with cathedral ceilings? Are you planning on an owner’s suite? Will you have an eat-in kitchen? Do you need a three-car garage? Do the math and this will give you a rough estimation of the total square footage.
  3. Decide on a home style. Do you have a fondness for a traditional cape, a classic Colonial, a rustic post-and-beam, farmhouse, Tudor, or a contemporary home? Are you leaning toward single-floor living? You can find sample home designs and floor plans online and in magazines. Take the time to browse your choices. Drive around and take photos of homes you like. Put these in your Vision Book.
  4. Consider your homesite. If you already own your homesite, consider the type of home that will work best there, Think about how you will situate your home on the building lot. How will you utilize the best features of this land?

Build your Vision Book and then share it with the architects and builders you’re considering. They can help you determine some ballpark costs and advise you how to make adjustments for cost savings, energy efficiency, durability, and comfort. Even if you’re not quite ready to take the next step, start a Vision Book. There’s no price for dreaming!