Thinking About New Construction?

A new construction project can be exciting and sometimes even rewarding.  A few participants have commented that they might even consider building again.  Others have, however, made a few mistakes and are more likely to take a job with the IRS customer service department to avoid building another new home.  Here are three helpful tips that might keep the Prozac away from the bedside nightstand.

Your current home's real value: Be careful not to rely on an overly cheerful real estate professional who might have had too much happy juice when tackling the financial planning for a new construction project.  Various homes in Midland may not sell for what they appraise for or what the current SEV is.  Seriously consider having a conservative appraisal of the home before moving forward.  Do not use an appraisal done for refinancing as a basis when moving forward.

Warning:  Your new construction project may not sell for what it cost to build.  There are multiple factors that go into resale.  Your choice of custom antique flooring may satisfy your own 'must-have' dream home checklist but may not be in with the trendy in-fashion HGTV crowd.  If you suspect that you might sell without a relocation buyout package be careful when venturing too far away from current trendy decor.

Change orders:  One really effective way to over-build a house is through change orders.  While your best friend had a great idea (while drinking wine and watching Bob the TV Builder Expert) last night,  that does not really require you to jack up the construction cost by thousands with a new direction in the kitchen.  Really it is not what you want to do.  Turn off all home or real estate TV until the home is 100% finished.

These are just a very cautions for new construction projects.  Many more equally important tasks are also on the checklist.  Make sure to consult experts before moving forward.