There are some important questions that we should explore when we make the decision to purchase a home. This is the first part of a 2-part series contributed by Robert (Bob) Fusari, Sr., President and co-owner of Real Estate Service of Connecticut (RESC). Bob has been involved in residential construction and development for over 52 years, building custom single family homes, subdivisions, condominiums and apartments numbering in the thousands. He has built individual communities as small as 10 homes to communities over 3500 homes. Bob is actively involved in the Connecticut Home Builders Association, and was chosen builder of the year in 1995. He is a director and currently Chairman of the Middlesex County Chamber of Commerce. We are pleased to present Bob's insights into how we can make a wise decisions when purchasing a home.
Part 1: New Or Used
The most important question to ask when deciding to purchase a home is:
"Do I want a new home, or a previously lived-in home?" Either choice has advantages and some disadvantages. With a previously lived-in home, I can move in right away. However, the unknowns that perhaps weren't obvious at inspection time may soon surface, and can cause aggravation forever after. Conversely, when purchasing a new home, even though some problems may surface, they most likely will be remedied by the builder, and I can enjoy my home with some certainty of what I have purchased.
"How important is technology to me?" With a previously owned home, I will be buying yesterday's technology, along with a shorter life left in some of the important systems in the home. Roofing and mechanical systems may have some useful life remaining, but chances are they will not have the same useful life as the systems in new construction. Also, the technology in newer home systems may be very different from an older system.
"How important is design to me?" When purchasing a previously owned home, I am purchasing someone else's dream home, and the design and layout may not be optimal for me. When I purchase a new home, the home will be my own and designed close to my own specific needs.
If, based on your answers to these questions, you decide to purchase a newly constructed home, it is important to know the differences between the two basic buyer/builder arrangements. They are 1) You can purchase a lot and hire a general contractor to oversee building your home; or 2) You contract to buy the entire house and lot package from a builder/developer. This is called the "turn-key" method.
The general contract choice may, at first, appear lest costly. However, you could intentionally or intentionally be assuming the role of "general contractor" with all of the associated risks and responsibilities. It will be your own money that is tied up in the purchasing the lot, and you will probably be responsible for the construction loan, including points, legal fees and interest. Also, since you are the property owner, you may also be assuming certain risks during construction that are generally associated with the general contractor, including: builder's liability, workman's compensation, compliance with OSHA regulations, exposure to mechanics liens,and producing a lien waiver at mortgage closing.
When purchasing a home under a turn-key arrangement, you will not actually own the property until the home is finished, thereby minimizing your risks. And, you will be better able to establish your final cost up-front.
The bottom line is that it is important to do your homework.
Knowing where do you want to live, or location, is the starting point. Make a list of towns you are considering and list the positive and negative aspects of living in each of those towns.
Think about what features are important to you in owning a home, write them down, then prioritize your wish list. Generally the size of your wallet will help determine the general size of a home and the amenities that you will choose. Include your preferences on number of bedrooms, baths, and kitchen features. Does your dream home include a home theater, and high tech wiring? Computer simulations, plan books, design centers, model homes, and Internet searches can help you refine your list.
Decide the style you prefer: traditional, contemporary, Victorian, ranch, raised ranch, cape, colonial, etc.
How important is re-saleability to you? It is important to keep in mind that features that appeal to you may not appeal to others. Consider whether the feature that you desire can be easily removed or changed to fit someone else's taste.
....coming next week: "Do I really need an architect?" and "What should I look for in a builder."
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