If you’re planning to build a new house – one that you’ll be paying hundreds of thousands of dollars on, and living in for at least 10-15 years – you really need to do your due diligence in researching home builders. The final price isn’t the only factor – builders should have good communication, a great reputation, examples and testimonials of their work, be trustworthy, and you should feel comfortable with their overall personality and work ethic.
But sometimes, things seem a little off and maybe you can’t put your finger on it. Or maybe you’re disappointed in one thing in the beginning of the home building process and you aren’t sure whether it’s just a one-time blip or a hint of bigger problems to come. Beware of these home builder red flags to avoid.
When you’ve narrowed down your list of potential builders, be sure to review these questions to ask a home builder so you’re prepared when it’s time to interview.
– Finances: If you’re meeting with several builders (which you should), beware of any quotes that seem much lower than the others. Many builders will provide lower quotes to get your business, with allowances that are way too low and additional fees and markups later. Have a plan for what type of finishes and design elements you want (especially in the kitchen and bathrooms, where prices can add up quickly!). Also, beware if any builder demands a large sum of money upfront. Always rely on your lender to oversee financial transactions – you don’t want to pay tens of thousands of dollars directly to your builder and have them disappear in the sunset.
– Timeline: If you’re building a custom home and the builder promises a fast timeline for completion, it may be too good to be true. Even if your construction plans are relatively simple, any number of factors can delay the schedule. Realize that it could take 6-12 months for your home to be built – maybe longer if your home is quite large or very custom. Get the timeline in writing, along with what will happen if the home isn’t completed on schedule.
– Involvement: If you’re planning to be heavily involved in every step of the homebuilding process and also walking through the house often, let the builder know in advance. Some builders don’t want to deal with constant questions or with clients who scrutinize every detail. If you’re building a custom home, the builder should be perfectly fine with you making most of the decisions and asking questions along the way. If not, they might be trying to hide shoddy workmanship or worse.
– Communication: If a builder has bad communication before you sign a contract, they’ll probably have bad communication throughout the whole process. Also, any contract that is ambiguous or highly favors the builder should be reviewed by an attorney for fairness. Trust and communication are key when building the home of your dreams.
– Credibility: Builders should be more than willing to let you view their completed work and speak with former clients, and not just a select few. If they’re unwilling or unable to give references and prove they’ve built homes similar to what you want, that’s a red flag. Side note: You do not want your home to be the first complex, custom home for a builder who’s only built small, basic homes before. They should also be able to provide licensing and insurance coverage if you request. And sometimes even a quick Google search will warn you of any bad reviews or legal trouble they’ve had.
Building a home is often stressful even with the best, most experienced builder. There will always be little unplanned “hiccups,” and what counts is how you and your builder react to them. But beware of the home builder red flags discussed above. Whether this is your first or fifth homebuilding experience, you deserve to reflect afterward and think, “I had a fantastic builder!”