Buying a New-Construction Home? 7 Things to Know Before You Visit the Model
- Register your own agent on your first visit to any model home.
- Builder incentives are often tied to the builder’s lender. Compare the full loan, not just the incentive.
- Ask about Mello-Roos and HOA dues. They can add hundreds of dollars a month.
- Get your own inspections, even on a brand-new home.
New homes are exciting: nobody has lived there, everything works, and you can often pick your finishes. I love helping buyers with new construction, but I also see the same avoidable mistakes again and again. Here is what I tell every buyer before they walk into a model home.
1. The sales agent works for the builder
The people in the sales office are usually pleasant and helpful, and they are paid to get the best deal for the builder. Having your own agent means someone is looking out for you on price, incentives, upgrades and the contract.
2. Register your agent on the first visit
Many builders require your agent to be with you, or registered, the first time you visit. If you walk in alone and sign the guest card, you may lose the ability to have representation later. Many builders pay a cooperating broker fee, so your own representation often costs you nothing, but confirm that up front.
3. Incentives are often tied to the builder’s lender
Builders frequently offer rate buy-downs or closing-cost credits if you use their preferred lender. Sometimes that is a great deal. Sometimes the rate or fees elsewhere make up for it. Get a Loan Estimate from the builder’s lender and at least one other, and compare the total cost.
4. Ask about Mello-Roos and HOA dues
Many newer California communities are in a Community Facilities District, commonly called Mello-Roos, which adds a special tax to your property tax bill to pay for local infrastructure. Add HOA dues, and your monthly cost can be several hundred dollars higher than the price alone suggests. Ask for the exact figures and how long the special tax lasts.
5. Upgrades add up fast
Base prices are base prices. Lot premiums, structural options and design-center upgrades can add tens of thousands of dollars. Decide what really matters to you, and remember that some upgrades are cheaper to do after closing.
6. Get your own inspections
City inspections check code compliance; they are not a full review for you. An independent inspection before drywall and another before your final walkthrough can catch issues while the builder can still fix them easily.
7. Read the contract before you fall in love
Builder contracts are written for the builder: deposit terms, construction delays, change orders and warranty limits. Read it, ask questions, and understand what happens if the timeline slips.
Thinking about a new home in Fremont, the Tri-Valley, Tracy, Mountain House or Sacramento? See our new construction page, and check your numbers with the buying power calculator.
Quick answers
Do I need a real estate agent to buy a new-construction home?
You are not required to, but the builder’s sales agent represents the builder. Your own agent can negotiate incentives and upgrades and review the contract, and many builders pay a cooperating broker fee.
What is Mello-Roos?
A special tax in a Community Facilities District that pays for local infrastructure in many newer California communities. It appears on your property tax bill in addition to the regular property tax.
Should I get an inspection on a new home?
Yes. City inspections check code compliance, not quality for you. An independent inspection before drywall and before the final walkthrough is a smart, relatively low-cost step.
Planning to visit a new community? Call me before your first visit so I can register as your agent and help you compare builders and incentives.
Bilal Salimi, Broker · Visionary Estates · CA DRE #01480904
Insights are general information to help you think through your options. They aren't legal, tax or financial advice, and every situation is different. Visionary Estates · 44840 S Grimmer Blvd, Fremont, CA 94538 · CA DRE #01480904 · Equal Housing Opportunity.