Avoiding Financial Mistakes Building a New Home

When it comes time to find the perfect home in Washington, you’ll often hear from people that buying an older home is more affordable than building a new one. If you build a large mansion in an exclusive neighborhood, you will spend more, but you can also build an affordable home in some of the fastest growing parts of the state. By avoiding some of the common financial mistakes associated with building a new home in Washington, you’ll be on your way to success.

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  1. Plan Ahead

A common mistake people make is they don’t take the time to plan in advance. When designing the way your master bedroom will look, you need to think about how the paint color on the walls will work with the carpeting or tile on the floors; think about the relation of the doorway to the room and whether you want a private bathroom; even take the time to consider first and second floors since you might not want your bedroom above the garage.

Moreover, if you keep changing your mind about what you want in each room, and add on new features that didn’t exist in previous designs or even adjust the placement of doors and windows, you’ll see your costs skyrocket.

  1. Too Many Features

Another mistake many make is that they add too many features upfront. You might find yourself designing a home with a large wraparound porch and multiple bedrooms for the kids you want to have in the future. Some also make the mistake of opting for features found on more expensive homes, including granite counters in the kitchen, custom glass surrounds in their showers, and hardwood floors in each room. As you work with your builder, keep in mind the amount of space and the exact features you need. Building a home that is too big and too expensive to maintain might lead you to sell your home and lose money in the coming years.

  1. Assess Resale Value

Even if you plan on living in that home for years to come, it’s important that you look at its resale value before construction starts. No matter what your stance on marriage, kids, or your current location are, you might change your mind. Homes in certain Washington neighborhoods retain their resale value, but other homes may drop in value over the course of a single year. While you can add all the features you want, you need to think about whether others will love those features if you put your home on the market later.

  1. Consider Your Mortgage

Unless you have unlimited funds at the ready, you probably need to apply for and obtain a mortgage before construction starts. Banks and credit unions often base the amount you can borrow on your credit score and current income, but this may leave you with a higher mortgage than you actually wanted. Some view this as a sign that they can afford a larger home, which causes them to add more square footage to the layout and more features that they didn’t want in the beginning.

The more your home costs, the more your mortgage will cost. Even if you can easily afford your mortgage today, you never know what the future has in store. If you get sick or your spouse loses his or her job, you may suddenly have a mortgage that doesn’t fit with your budget. Opting for a basic plan upfront and adding new features later can help you stick to your budget and still build a great home.

No matter how tight your budget is, you can still opt for upgrades and amenities that work with your lifestyle. Tile floors might cost a little extra but are better for homes with pets and kids. Adding a few simple upgrades can significantly increase the value of your home. You might ask for a full basement that you can use as a recreational room or an extra bedroom for your kids. Building that basement now may cost less than what it would cost years from now, and as your builder creates that space when building your home, it becomes part of your home builder mortgage lender loan. If you pay for upgrades later, you may need to take out a second mortgage or even pair for those upgrades out of your own pocket.

  1. Plan For Surprise Costs

Even if you like surprises, you won’t like the surprises that can arise during the construction process. Far too many people put their trust in the hands of their builders and expect those builders to notify them of any problems. Visiting the construction site at least once a week can help you stay on top of unexpected issues. You never know when you might arrive and find the job days or weeks behind schedule. There is also a risk that the builder might make changes based on your budget without telling you first. Unless you want to face lawsuits and expensive repairs or fixes in the future, you should keep an eye on your builders during each step in the construction process.

Though building a home lets you create your dream home, far too many focus on the minor details instead of the big picture. They meet with the architects regularly, keep visiting the construction site and annoy the builders with dozens of upgrades or changes they want to make. Others build a home with more features than they want or need because they think the finished home will solve all their problems.

Regardless of which decisions you make, a home is still just a home. It can serve as a welcoming space for your family and friends, the place you raise your children before sending them off to college and the home that you share with your spouse in your golden years. If the costs skyrocket, you’ll find that your dream home feels more like a nightmare. Keeping an eye on your budget and making choices that work with that budget is the key to building a house you love. Work with your builders to create the perfect home in Washington state at an affordable price.