Building A Home: 6 Things Your Builder Will Not Tell You

Buying a newly constructed home should be an enjoyable experience. Sadly, for most consumers, it’s a nightmare that will stay with them the rest of their life. A common statement made by many new homebuyers is that they will never have another home built for them.

Here’s 6 things your builder will probably never tell you.

“We market that our company only uses the finest craftsmen to build our homes when in reality, we use the cheapest trades we can find, which means that many are not skilled and are day laborers.”

Custom and spec homebuilders bid out the work on your home to the lowest bidder. Kinda like the U.S. Government. There is few Custom builders left who do their own work and have their own crews.

“I have a binding contract that will prevent you from suing me should you have major defects in your home after you move in. And better yet, there is little you can do to get me to fix it!”

Read the fine print on your contract. Better yet, have a real estate attorney read it for you and explain to you what legal recourse you have should there be problems after you close. I bet you’ll come out of the attorney’s office amazed at how little rights you have if you sign the builders contract.

“If you’re really smart, you’ll hire your own third party, code certified, home inspector because the public inspectors and even my own inspectors aren’t here with your best interest at heart!”

Builders today search out third party inspectors to perform “Quality Assurance” inspections. Problem is, this is just more marketing hype than anything. In most states, these third party inspectors do not have to be licensed to perform “Construction Inspections”. My inspectors and I find a long list of items that these inspectors either miss or ignore on every new home we inspect. Not once have we found a home that the builders inspector found a majority of the defects.

City and county inspectors are generally about the same as the builders inspector or worse. Many of these inspectors are so piled up with work that they can only spend 15 to 20 minutes in a home. Besides, it is not the City or County’s inspectors job to look for workmanship issues, they are only there looking for health and safety issues and protecting the City and County’s interest. Just like the builders inspectors are there protecting the builders interest, not yours!

If you don’t know a good code certified home inspector ask around or check out the American Society of Home Inspectors at ashi.org

“My sales people and I can tell you anything we want because we’re not regulated by the State”

In many states, you’ll find that the sales people for builders are not licensed with the real estate commission like Real Estate Agents are. This lets them tell you whatever they need to so you’ll buy a home from them. I’ve heard just about sales people promising homebuyers just about anything you can imagine they’d buy from their builder. Buyer beware and get them to put it in writing before you sign the contract!

“Your home is built over a landfill or swamp… maybe both.”

As prime land is filling up with new homes, real estate developers and builders are turning to sub prime land. Here in my market, we have subdivisions sitting on landfills, swamps and former rice patties. None are prime areas for building a home on.

“If you back out of the contract for any reason, we’ll keep your earnest money an upgrade money”

Many people are surprised to find this is true. In Texas most builders will, check with the Attorney General in your state to see if this is legal. Again, the builder or sales people may tell you different, but most contracts have a clause that says you’ll forfeit your earnest money or upgrade money if you back out of the home. Get it in writing what happens if you back out and the steps you must take to get your money back. Don’t think it won’t happen to you because I see it happen all the time.

As each state, county and city is different, you should check with a knowledgeable inspector in your area plus your real estate attorney before purchasing a newly constructed home. Also, GET EVERYTHING FROM THE BUILDER IN WRITING! If he promises you he’ll throw in a few extra outlets in the garage, get him to put it in the contract.