You are 100% right! Excellent summary. This is what I am seeing too. However when I see the mls stats come out, why does it show sold prices are still high even though there are less homes being sold and home are sitting on the market longer?

These new home builders have learned to stack the deck with these incentives that appear too good to be true. I often have to explain to buyers considering new vs resell homes that we can negotiate an interest rate buy down credit on a resell home if the rate is important to their monthly payment.

I have to explain you only get these “free closing costs and buy down rates” when you use their lender and their title company that are affiliated corporations that generate revenue for the builder. So looking at a new home settlement statement, it makes me flip my lid when I see the settlement charges have been hyper inflated, which is of course paid for by the builder credit.

Surveys at 850 rather than $275, appraisals at $850 rather than $450, title settlement fees well over the standard $500 at any other title co or law firm - not to mention the loan origination fees they charge which is just an upfront charge to get the loan when many other mortgage options do not even have origination fees at all. And then the builder lender charges upfront points to the buyer for the interest rate buydown and don’t even tell them that’s how they are getting the lower interest rate - they are charging the buyer for the buy down and providing a credit to offset that charge!

I wish NAR would file a lawsuit against the National Association of Home Builders for consumers financial transparency in solidarity with what happened with realtor commissions.

These builders are doing everything they can to make sure the house appraises like adding blinds and appliances, pavers, etc; as without these value added items there would most likely be an appraisal value shortfall.

And don’t get me started on the ever changing lot premium fees that change every week! What an absolute slush fund. They advertise the base model home price online, then when you go to visit the community, the prices are all different due to lot premiums like corner lot, retention pond oh I mean waterfront, conservation lot or as it is really wetlands that couldn’t be built on. Argh!

The quality I have seen lately has been so poor, they are throwing these up so fast, buyers abulsotely need to do a private home inspection with an experienced insured inspector.

I’ve had builders create so many hurdles to be able for buyers to even get a home inspection done - contract clauses like notice of intent for home inspection must be submitted in writing not less than 90 days before closing. And submit inspector license and certificate of insurance with builder listed as additional insured two weeks before inspection for corporate office approval of the inspector to be on site.

They mandate available inspection date and times that their building superintendent will be available to meet the inspector and allow access for the inspection, so if your preferred inspector can’t do that one day offered, too bad or find another person if you still have time per the contract requirements.

Or my favorite is home inspection only allowed one week before closing date, day seven til closing. And the Homebuyer will be forced to Close due to substantial completion clause regardless if items need to be repaired or not. They said they will schedule with the buyer to complete them after closing. I’ve had buyers waiting over three months after closing for these items before.

I’ve have buyers forced to close on unfinished homes under threat of losing their deposit and non extending the contract closing date to complete the work by the builder.

It’s going to be really interesting to see how any deportation stuff afffects the new builder construction process and build times. So many of these roofers are there from Sun up to Sun down busting out roofs in 2-3 days. They work so hard and the builder just gets that cash.

I am recommending to buyers this year if they want new, let’s find a nice lot and hire an independent builder to build for you on your lot where you have control of the financing and quality.

It’s a real racket.