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What is the cost range for a 4 bedroom, 2.5 bathroom ~2500-3000 sq foot house for a new construction in Walpole, Canton, Mansfield, Foxboro area? How much for the land and how much for the actual house? Our budget will be $650k max so I'm wondering if that's going to be enough in these towns.
How do mortgages work for construction? When do you pay and how much? Do you pay before building starts? When it's done?
How long does it typically take for a new construction to be built?
I own a condo right now and have about $80k in equity. Would I be able to tap into that to help fund the down payment for a new construction?
My wife and I are planning to buy/build in early 2014 but we want to start looking at houses now to get ideas of what we like. Do we need an agent to do that or can we just calling selling agents on listings we're interested to take a look? I don't want a buyer's agent right now since we won't seriously consider buying until early 2014.
I know other questions will pop up and I just thought of another one. Where is the best place to look for new constructions and lots of land? I've been looking on Zillow for homes but I'm getting the impression it's not the best source for new constructions.
Can you clarify your question a little bit? Is your idea that you will buy a piece of land and hire someone to build a house for you or is your idea that you are going to find a house already being built and buy it? Depending on which of these is your plan you'll get a totally different answer.
hmmmm can I cop out and ask both? I was originally thinking buy land and hire a builder but I'm now also curious about buying a house that's already in the process of being built
Do you really want to have a new house built when there is so many others on the market? Given the housing slowdown with construction I am not sure if using current contractors might be a wise idea. It might be the housing equivalency of a monday car.
One of the first things I would also reply with is that with heating your options are dependent on access. If there are no gas lines then putting in a new gas line might be quite expensive otherwise.
Are you at least currently in Mass? I say that because Foxboro is going to have some traffic during Patriot games and other events and Mansfield has the Comcast Center which should also be a bit of a concern. Maybe it might make sense to go to some of the local town halls to ask what the most recent construction has been in the past few years and also some of the zoning codes.
There's really not a short answer to your question as you've posed a really broad one. Here's a little bit of info to get the conversation started . . .
When buying new construction it really boils down to one of three situations:
1. Custom build - you as the homeowner are involved from start to finish and have to hire your own builder. This option really offers the most flexability as your only limits are your budget and the town's building codes. However, you'll likely have to finance using a construction loan which generally have higher rates than mortgages. Plus, you'll need to pay down the loan as the construction process occurs. This will also be a longer process as you'll be making every single tiny decision and you'll be invovled in the permitting and building.
2. New subdivision - buying in a new subdivision usually involves working with a large corporate builder. This means you'll have a small selection of floorplans to choose from and a small selection of finishes to pick from as well. Buying this way is similar to buying a car as you'll be offered the house at a base price can increase the price by choosing "options" or upgrades like a finished basement or third floor. I've also seen builders offer upgrades such as a wine cellar, home theater, or an elevator. In this situation, you put down a deposit but don't have to pay for the house until it's complete so you can finance with a traditional mortgage. The timeframe for this build depends on how fast you pick your finishes and how far along the house is when you find it. If there's just land when you come in, I would expect around 8-10 months.
3. Single lot subdivision (a/k/a teardown) - in Newton, Needham, Wellesley, etc this is the most common form of new construction. A home is purchased by a builder and then raised to create a building lot. Some builders offer the home for sale immediately upon purchasing the land and some wait until further along in the building process. Depending upon where in the process you come in, you can have more or less say in how the finished product looks. In many cases, the builder offers you an allowance for things like tile, carpet, appliances, etc and you have complete flexability in choosing which you want. If you want to spend more than the allowance that becomes an upgrade which increases the price of the home. The plus here is that you only put down a deposit and when the house is complete you can finance with a traditional mortgage. This process is a similar timeframe to buying in a subdivision.
Considering you've never built a home before, I think you'll be a lot happier in the end if you go with #2 or #3. Building a custom home is difficult because doing it right requires some experience. I've seen a lot of custom homes with some strange features or strange floorplans which have negatively impacted resale. Also, with a custom build you'll need to pay the construction loan and the mortgage on your current home as well.
There are a lot of factors at play with this decision. You'll have to sit down and decide what is the best fit for your finances and your stress levels.
Also, in terms of HOA's, most subdivisions in eastern MA don't have HOA's and if they do have them often they come with few rules. They're more common and more intrusive in other parts of the country. This doesn't mean you will not encounter an HOA, but they're less of an issue in these parts. The HOA will not go away so if you buy in a developement that has one read the rules carefully before committing.
A family member just went through this. They were looking in Mansfield and Wrentham. The problem they found was either the houses with the SF they wanted 2200-2800 tops they wanted were old with floor plans that were not feasible or they were new and just too big at 3000 sf +. This was house # 3 for them. First house was a gut, second house just needed a small remodel and this one was to be their forever house. They opted to build. They didn't save any money. They actually could have bought one of the bigger homes they looked at for less. What they did get, is the house they wanted and needed, brand new to their specs. They spent a great deal of money on high end finishes- not just because they looked good but because they wanted to "do it once and not have to do it again". That included high quality flooring, custom built cabinetry in their kitchen, baths, laundry and mudroom and lots of very nice, high end windows. The time frame was longer than they would have liked but worth the wait to them. Being this was house #3, they knew exactly what they wanted but more importantly needed. Every detail was thought out because of their experience in their previous homes.
Do you really want to have a new house built when there is so many others on the market? Given the housing slowdown with construction I am not sure if using current contractors might be a wise idea. It might be the housing equivalency of a monday car.
One of the first things I would also reply with is that with heating your options are dependent on access. If there are no gas lines then putting in a new gas line might be quite expensive otherwise.
Are you at least currently in Mass? I say that because Foxboro is going to have some traffic during Patriot games and other events and Mansfield has the Comcast Center which should also be a bit of a concern. Maybe it might make sense to go to some of the local town halls to ask what the most recent construction has been in the past few years and also some of the zoning codes.
Thanks for the comments. The reason why we are thinking of new houses is because my wife and I plan for this house to be the house we live in for the next 30 years. We currently live in a condo but plan to have children soon and move into our long term home. If we buy a house that's 15 years old today, we might get a better deal but in 30 years that house will be 45 years old. Also, I'm thinking new homes will be the most energy efficient, have the most technology built in, etc. Does this make sense? Do you (and others) think in my situation that we should be looking at new homes or older homes?
Thank you for the point about gas lines. Ideally I think we'd want to build in an area where that is already set up.
And yes, we are currently in Mass (Norwood). We need to be close to Boston because I work there, but we also need to be close to RI because both my family and my wife's family lives there. We'd also like easy access to 95 to make our families' visits easier. So we've narrowed it down to Canton, Walpole, Mansfield, and Foxboro.
There's really not a short answer to your question as you've posed a really broad one. Here's a little bit of info to get the conversation started . . .
Wow, lots of info here, thanks so much.
Quote:
Originally Posted by MikePRU
When buying new construction it really boils down to one of three situations:
1. Custom build - you as the homeowner are involved from start to finish and have to hire your own builder. This option really offers the most flexability as your only limits are your budget and the town's building codes. However, you'll likely have to finance using a construction loan which generally have higher rates than mortgages. Plus, you'll need to pay down the loan as the construction process occurs. This will also be a longer process as you'll be making every single tiny decision and you'll be invovled in the permitting and building.
Correct me if I have this wrong, but my understanding is that a construction loan is short term and you pay interest only (with rates higher than a trad'l mortgage) but then once the home is built you can enter into a trad'l mortgage.
We like the idea of flexibility but it does sound very stressful picking everything.
Quote:
Originally Posted by MikePRU
2. New subdivision - buying in a new subdivision usually involves working with a large corporate builder. This means you'll have a small selection of floorplans to choose from and a small selection of finishes to pick from as well. Buying this way is similar to buying a car as you'll be offered the house at a base price can increase the price by choosing "options" or upgrades like a finished basement or third floor. I've also seen builders offer upgrades such as a wine cellar, home theater, or an elevator. In this situation, you put down a deposit but don't have to pay for the house until it's complete so you can finance with a traditional mortgage. The timeframe for this build depends on how fast you pick your finishes and how far along the house is when you find it. If there's just land when you come in, I would expect around 8-10 months.
The idea of having a selection of floorplans sounds nicer. I like how you can finance with a trad'l mortgage from the start too. 8-10 months...wow. We want to look buying as soon as my wife gets pregnant so that won't leave us much time to get in before the child is born.
Quote:
Originally Posted by MikePRU
3. Single lot subdivision (a/k/a teardown) - in Newton, Needham, Wellesley, etc this is the most common form of new construction. A home is purchased by a builder and then raised to create a building lot. Some builders offer the home for sale immediately upon purchasing the land and some wait until further along in the building process. Depending upon where in the process you come in, you can have more or less say in how the finished product looks. In many cases, the builder offers you an allowance for things like tile, carpet, appliances, etc and you have complete flexability in choosing which you want. If you want to spend more than the allowance that becomes an upgrade which increases the price of the home. The plus here is that you only put down a deposit and when the house is complete you can finance with a traditional mortgage. This process is a similar timeframe to buying in a subdivision.
This sounds like a good alternative as well.
Quote:
Originally Posted by MikePRU
Considering you've never built a home before, I think you'll be a lot happier in the end if you go with #2 or #3. Building a custom home is difficult because doing it right requires some experience. I've seen a lot of custom homes with some strange features or strange floorplans which have negatively impacted resale. Also, with a custom build you'll need to pay the construction loan and the mortgage on your current home as well.
I know VERY little about building a home, but luckily my father is an expert (built his own home, the house I grew up in) and he will be able to help with all decisions we need to make.
Quote:
Originally Posted by MikePRU
There are a lot of factors at play with this decision. You'll have to sit down and decide what is the best fit for your finances and your stress levels.
Also, in terms of HOA's, most subdivisions in eastern MA don't have HOA's and if they do have them often they come with few rules. They're more common and more intrusive in other parts of the country. This doesn't mean you will not encounter an HOA, but they're less of an issue in these parts. The HOA will not go away so if you buy in a developement that has one read the rules carefully before committing.
Thanks, I want nothing to do with an HOA for our home. I noticed Walpole Estates has an HOA and just because of that I've now ruled it out.
Thanks again for the helpful insight.
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