How much can you negotiate when purchasing a new construction?

Question

What variables are important?

Answer 1

That all depends on the seller.  A large company such as Lennar normally tends to offer more in terms of incentives than a smaller private firm that handles a more reduced inventory.  Normally if you go with there prefered lender they tend to give things like closing costs & upgrades for free.  Moreover, many developers tend to run specials throughout the year also.

 

Miguel A. Salvat

www.miguelsalvat.com

Answer 2

Nathan:

 

 

You'd be suprised! Current market conditions have ruled out the day of the shady seller or salesman.  Most salesman that work for these developers would happily volunteer this information in order to make the sale.  In most real estate transaction realtors are compensated by a percentage of the sales price, but when it comes to large development companies most salesman are compensated by salary with bonuses based on performance so they are motivated to volunteer as much information as they can to make the sale.

Answer 3

It depends on the property...some closeouts have big incentives and much lower prices because they want to finish and move on. I haven't seen one yet that wasn't negotiable in this market!  It's a buyers market!!

Sandy Maltese - Realtor 469-964-2669  www.dallaspropertylocator.com

Answer 4

That depends on what your definition of negotiate is.  

Many builders are flexible, but not willing to budge much on price. They're far more likely to sweeten the deal with upgrades and incentives. The builders are simply manufacturers/retailers whose inventory is houses, and exist in a marketplace (real estate) where future buyer can see what PAST buyers paid. Selling for less than list price to a buyer today tells tomorrow's buyers how much of a discount to ask for - but putting in marble instead of solid surface counters, hardwood instead of carpet doesn't show up in transaction history. THAT's what you you want to ask for - and builders will generally be far more willing to give up $50K in upgrades than $25K in price reduction.

Answer 5

Bottom line haveing grown up in an "Land Investor Family" and with children in Real Estate.  It all comes back to the BUYER

ASK for what you want, If they say NO, ASK again and add WHY not? [ Everyone appreciates a friendly exchange, and a gracious thankful winner ] Then find a win- win  agreeable compromise, remember the saying "ASK and ye shall receive.............."!

O yes, and understand when a Developers "Agent" [ by any name ] given to you to help you?  They are paid..........by their employer the Developer [ NOT an independant agent like your Realtor- who is there to HELP YOU ! ]  When they tell you "that they can give you the Realtors Fee as a discount by working with them only............NOT TRUE!!!  They have a marketing fund, and they must pay your Realtor, without PENALTY to you, for your Realtors help as a marketing agent........!

Answer 6

Variables, when purchasing new construction? Yes, in today's climate, all variables such as land costs, materials, labor, etc. should be considered when negotiations begin with a builder. Be realistic with you negotiation! A builder will be more open, in return. Contact me for more information @ ccgleaton@bellsouth.net

Answer 7

It definitely depends on the conditions of the market and the personal position of the seller.

In our area, builders tend to shy away from reducing the price of a home, since that may negatively affect the appraisal of all future homes, and thereby reduce their profit over their remaining inventory.

Instead, they tend to include upgrades or incentives at no additional cost...closing costs, appliances, blinds, fenced yards.  Some even offer things you wouldn't necessarily expect to be thrown in at closing, such as an iPad2, a 42" flat screen TV, or an iPhone4.

Keep in mind, too, that just because they have a large chunk of change listed as going to them at the bottom of the HUD, that isn't all profit.  In many cases they have to pay for the various aspects of a development (water/sewer lines, septic tanks, development fees, etc) from the profits of each home, in addition to paying for labor, construction and land loans, etc.