WDP-Acura TL

Does anyone buy newly constructed homes in new development sites. I was told that when you buy a brand new home its much cheaper than buying a house that has apprectiated. The gentleman I was talking to said he bought a home for $200,xxx and was able to sell it a month later for $230,xxx before construction took place. Hypothectical question- Lets say the house costs $150,000 and I put $15,000 down and the rest is taken care by the bank in loans. Am I still able to sell the house. If house isnt paid in full by me. The genteleman also said that after the hose is built a month or two thats when the hose starts to appreciate. Will I incur any penalties? I'm, new to all this. Is this legal ?

chef chris

All this is hypothetical depending on the local market.

Last house I had built took alot longer than 2 months to build and took about 2 years to appreciate...however, now the market has cooled off and new homes are just as much as a regular home. Not to mention, older homes normally have more property.

Let me be the first to say that I had the same thoughts you're having now...I even contemplated buying a new home every few years to build up money from the appreciation factor...but, there are a TON of headaches associated with new construction, trust me.

doopstr

Large builders like K Hovanian put clauses in their new home sales. If you attempt to flip a home (sell it within one year of construction) you have to give the builder the profit. They don't want people flipping their homes.

Scrib

keep in mind that purchasing a newly built home requires a LOT of work... landscaping, for example is one of the biggest expenses.

chef chris

Big bucks there...not to mention all the "little" things that you need to do when you get into a new home. Normally, the garage door openers need to be installed, the trim may need some lovin, hardware from the builder is usually shitty, and about 99% of the light fixtures(especially outside) are crap. Fixing settlement cracks is also a HUGE PITA as is fixing creaky floors and ill-fitting doors after settlement.

For example, I had to buy $80 worth of hardwood flooring because 2 pieces got water damage...can't buy just 2 pieces though, etc. Ever try replacing 2 pieces of hardwood in the CENTER of the room? It's not too easy...

dallison

good to know

Iron_Eagle

I bought a new home in a new tract in feb 2003, and by construction end in july I was already up $50K or ~19%.

As doopstr mentioned though, a lot of builders prohibit flipping/renting within a certain time period, especially here in CA.

ChrisKelly5

Depends where you are....

I closed on my new construction home March 31, 2003.. I purchased it for 149,XXX with 30,000 down...

So, I financed about 119,XXX.... Well, I am about to sell my home (within 1 year) and it just apraised at $209,000!

That means I made about $60,000 in only 2 years on my house.... not bad.

We are looking to build a $250,XXX home in the same neighborhood, different subdivision.. I am estimating that in about 2-3 years, my new home will be about $275,XXX

I live in Jacksonville (fleming island) and they are building houses quicker than you can imagine.. so, I can only speak for this area.

I am going to

Scrib

Keep in mind that anything you hold for less than two years, you will be required (BY LAW) to pay taxes on the profits.

It's considered normal income.

yunginTL

since last march when my house was built, the price has gone up by close to $30,000, its freakin crazy.

Reddly9007

Where in orlando is the house, just curious, i'm in Orlando also. I was speaking with a lender and he was telling me that even though most newly built home do rise in value, now home builders are getting hip to the game, they are doing more and more research to find out the true value of the homes, and price them accordingly. So its much harder now to see that big increase. Just his 2 cents, guess it makes sense though.

I am not even going to look for homes in Orlando cause the prices have already gone up so much. I have started to look further east, finding and buying a new home is such a pain in the ass, unless your loaded!