Financing and timing of a New Build #shortvideo #shorts #short #realestate #investing #house #tips

12 Sept 2024 · 1 min

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Steve D Valentine breaks down two ways to buy new construction: custom builds on your own lot take 2-3 years and need separate financing for the land and construction, while subdivision homes are faster and simpler, requiring only an earnest deposit until the builder finishes.

Questions this video answers

About two to three years from lot purchase through design, permits, and build.

You generally pay cash for the lot and then obtain a construction loan to fund the build.

An earnest money deposit is placed up front and is the primary deposit until the home is completed and turned over.

Chapters

If you're considering new construction, the two choices are going to be A, do I buy a lot, do A design and build, or B, go to a subdivision like the one that I'm at and use the builder that's there and the plans that they offer. The first one is timing and financing. There's two big things there. Because timing wise, if you're going to buy a lot, go through that process, go through design, go through a permits, go through a build year, a couple years, two to three years to go through start to finish, plus your financing. You got to pay cash for the lot, and then you have to figure out some sort of construction loan to build the house. Unless you're going to do cash on the subdivision side. You walk in, you kind of look through the models, you find a floor plan that works. You don't get to customize it as much as you would on the other side, and you put a deposit down, earnest money, and that's the only deposit until the home is completed and built and turned back over to you. It's a much simpler process when you don't have all the choices and all the things going through it. So those are the two differences. If you are considering new construction.