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Buying a brand new home

Can you negotiate the price on new construction or do you always pay the list?
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July 28 2013 - Laveen
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Answers (3)

Right now, new homes sales are selling just as quickly as resale homes.   Most builders are non-negotiable in our current market.  Unless is an inventory/spec home.  Some builders are known to negotiate on those homes, but very rarely.  Most will give incentives towards design center and/or closing costs with their preferred lender.  You would want to work with a REALTOR to represent you, as they have access to inventory lists, current builder incentives, etc.
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July 30 2013

Negotiating is always dependent on each parties position in the transaction.  Today, especially in the Phoenix area, new homes are selling like hotcakes.  There is very little room to negotiate because prices are rising and there is another Buyer right behind you that they will sell the home to at the higher price. Builders have the edge.

However, if the home is a spec that is nearing completion or has been completed this may be a chance to make an offer. Builders want to sell "quick move in homes" and get them off the books.

Finally, one area where you may be able to successfully negotiate a discount is in the lot premium.  Builders have a little padding in this area, and you may be able to knock a few thousand off the lot premium with little trouble.

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July 28 2013
You can try to negotiate a new home price but, usually you will pay the list price and may end up getting other incentives such as money toward closing cost, landscaping, appliance packages and more. This is where using a realtor can come in hand. Choose a realtor that has worked with the new builder. They will have learned what all they can get out of that builder. 

Going to a builder without a realtor isn't going to give you any better chance of lowering the price. You may think they won't have to pay that realtor's commission so, why not? If a builder lowers their price for one buyer, that closing price now provides a lower comparable for appraisers on the next homes the builder builds. It is also public information. By lowering the price for any buyer, they now lower their price for every buyer.
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July 28 2013
 
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