First Time Homebuyers in the Market for New Construction

Over the past year, the buyer’s market has been extremely competitive in many markets across the US, due in part to low inventory. With a limited number of properties being listed for sale, it makes sense that more buyers are turning toward new construction. 

Take a look at the results from recent surveys from the National Association of Home Builders in regards to new construction and first time home buyers:

First Time Homebuyers considering New Construction

The NAHB/Wells Fargo Housing Market Index (HMI) is a monthly survey of the National Association of Home Builder members, designed to rate the market conditions for the sale of new homes and the traffic of prospective buyers of new homes.

The February 2021 survey showed that builders reported an overall average of 43% of new construction sold to first-time home buyers. Sixty-six percent of builders said that more than 20% of their homes were sold to first-time buyers. 

An Upward Trend

The number of first-time buyers who purchase new construction has steadily increased over the past five years. In 2016, an average of 19% of sales of new homes went to first-time home buyers. The number grew to 32% in October 2018 and jumped to 43% in February 2021. This shows that every year, more first-time buyers are considering new construction.

5 Benefits of New Construction

With low inventory in most real estate markets across the country, more buyers are looking at new construction. Whether the home is already being constructed, or you buy a lot and start from scratch, there are many benefits to building a new home.

Move-In Ready

When you buy a previously-lived in property, inevitably, there will be something you want to change. Some homes just need minor improvements, like a fresh coat of paint, while others require a complete gut job. One of the best parts of a new construction home is that it is fully move-in ready. 

You can rest assured that plumbing and electrical are in working order, new appliances are installed and ready for first use, and every room matches your style. The only thing left to do is unpack. 

Designed for You

Starting with the layout, all the way down to countertops and color schemes, new construction is designed for you. 

When building new, you can work with your contractor throughout the entire process to make sure the floorplan meets you and your family’s needs. Open floor plans, high ceilings, and space for a home office, gym, or studio can all be incorporated into your new home.

As construction nears completion, you can select countertops, appliances, colors, light fixtures, and more. Your contractor will guide you through design options while helping you stay within your budget.

Lower Maintenance 

As a homeowner, maintaining your home is essential. With new construction, modern technology keeps maintenance to a minimum. 

Your home will be built to the most up-to-date codes and safety standards, with new plumbing, HVAC, appliances, windows, and roofing. This not only creates less work for you over the years, but maintenance costs will be less as well. 

Energy Efficient

New construction also utilizes green practices for highly efficient homes. Often, a third-party will rate the home’s energy efficiency, ensuring it meets requirements. With proper insulation, high-efficiency appliances and systems, your home will have a low carbon footprint and low utility bills. 

Home Warranty

Builders don’t just walk away after it is completed. A new home comes with a warranty, so you can feel confident about how the construction will hold up over the years. Should any issues arise during the warranty period, the builder will work with you to solve the problem. 

To make the most of these benefits, make sure you find a contractor you like and trust!

What is a HERS Index?

There are plenty of ways to make your home more energy-efficient. As homeowners, you know that with every scheduled maintenance and every home purchase, there are ways to save energy, money, and have a more sustainable household. 

With all of the options available, it can be overwhelming to sort through what will help your home run more efficiently, and what isn’t necessary. That is where the HERS Index can help.

What is the HERS Index?

The Home Energy Rating System (HERS) Index is the nationally recognized system to assess a home’s energy performance. 

HERS scores are designed to calculate the energy efficiency of new or remodeled homes. If you are in the market to buy a brand new home, the HERS score will give you an idea of the energy costs for the house.

How do you find out the HERS Index Score?

A certified HERS Rater can determine the HERS Index Score of your home. They will complete an onsite energy rating of the home, and then compare the data to a reference home. The reference home is an analysis tool designed to resemble the actual house in size, shape, style, environment, and climate. 

What does the score mean?

The HERS Index ranges from 0 to 150, with 0 being a home that produces or conserves as much energy as it uses. While a score of 0 is unlikely, the lower the score, the more energy-efficient the home.

The standard new home typically has a rating of 100, while the typical resale home has a score of 130. Using these scores as reference points, you can get an idea of how efficient your home is. 

How can I improve my home’s HERS Index Score?

The greatest energy expenses in a house are for heating and cooling. Whether you are remodeling your entire home or just looking for a way to save on energy costs, you can get a programmable thermostat, upgrade your HVAC system, or simply get an annual tune-up to make sure it is working properly. 

Other energy-saving tips include: sealing all air leaks, add insulation, upgrade to ENERGY STAR appliances, and consider installing solar panels

A HERS index rating can help you determine what type of fixes will be most beneficial for your home. 

 

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