Reprinted from The Washington Post
By Caroline E. Mayer
The Washington Post
If you’re considering buying a new home, here are some tips from building industry officials and consumer advocates:
Investigate the builder thoroughly. Call the local consumer affairs office or housing division in your county as well as the Better Business Bureau to see if any complaints have been lodged against the builder and, if so, how the builder addressed these complaints.
But remember, buyers often do not file complaints. So visit several different communities where the company recently built homes; the closer that community is to the one you’re interested in, the better.
“Go on a Saturday morning when everyone is doing yard work and randomly ask people what their experience was with their builder,” said William Young, director of consumer affairs for the National Association of Home Builders. “Ask them if they had any problems and if they were fixed promptly and property. Find out what they would do differently. Don’t just talk to one person; talk to three or four-, knock on doors if you need to.”
Read the contract carefully. If you don’t understand any part, consult a lawyer or real estate expert.
The builder might say it’s a standard contract, Young said, “but anything in a contract is negotiable and changeable. The only thing that matters is that both sides agree. Just because a contract’s preprinted does not mean you can’t cross out and change provisions.” Virginia real estate attorney Beau Brincefield said, “If you fail to negotiate, shame on you. Current builder contracts are more sophisticated and worse than ever before for the home buyers. They take away virtually every important legal right a home buyer would want to have.
“The builder is never obligated to complete a house on or before a certain date,” Brincefield said. “The contract rarely gives detailed specifications on materials but gives the builder the right to substitute. There’s no provision calling for money to be placed in escrow at closing to cover any unfinished items. Under most contracts, settlements must go forward even if the house is not finished to a consumer’s satisfaction. And the home warranty provision is so complex and drawn out that nobody I know of has ever collected a dime.”
Some builders may allow changes in these provisions but many large builders who construct hundreds of houses annually may not permit revisions in what they consider key parts of the contract. Brincefield also cautions buyers to make sure they know that the company they’re dealing with is not necessarily the big, national name that’s posted in all the advertising, but possibly a small, no asset subsidiary set up just to develop a specific piece of property. If that’s the case, make sure the national company is willing to accept liability and get that promise in writing in the contract,” he said. In fact, “get anything that’s very important to you in writing,” advises George Rose, administrator of Montgomery County’s housing division.
“If you want a certain brand of dishwasher, even if it’s in a separate list, get it in writing in the contract; make sure the builder is not free to substitute Rose said. “If the builder promises that the riding stable will stay and be for the entire neighborhood, that all driveways will, be concrete or that there’ll be only a certain number of houses on the street, make sure you’ve got it in writing in the contract if that’s important to you. An oral statement is very difficult to prove and enforce.
Request access to the Construction site for periodic inspections. Real estate agent Robyn Burdett advises buyers to insert a provision into the contract to allow at least two. inspections by a licensed home inspector. One inspection should take place just before the drywall is to be put up; another just before, settlement. And if the house is more than. 3,500, square feet, Burdett also advises an inspection after the foundation is completed.
Make all complaints, both during construction and after, in writing and keep copies. “You never know when you may need it,” said Carol Smith, a Denver based, building consultant.
Reprinted from The Washington Post, Saturday, January 25, 1997.