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| It's new, but it's not new. Then it's used. Well, maybe. But it has expensive special floors, gorgeous landscaping, cute decorations in the kids room and a fireplace in the master bedroom. Buying a model home is a little different than buying any other new home. There are some things you should watch out for, make sure it's a good deal. Purchasing a model home is similar to a purchase of a re-sale home although no one has ever lived there. Sometimes they are used for sales centers which might include offices for marketing purposes, but in most cases a purchase of this home ends up a pretty good deal for the buyer. Builders proudly display model homes as samples of their building savvy, putting their best foot forward for customers. A good amount of the builder's budget is buried in their model home complex and their formal presentation to the public. Many model homes have a lot of extras that you may not have been able to get under normal circumstances. The builder usually puts extra money into the upgrades and has special features to show buyers their "options" to enhance the basic plan and its standard features. From custom carpet, driveways, elegant front and backyard landscaping, patios, pools, and even hi-tech lighting fixtures. These are items usually not available to the average home buyer. To pin down the specifics of a model home purchase, ask the builder about each upgrade to the base version of the floorplan and the value to it. Builders will typically discount the total figure to get a quick sale on their model homes when they are down to just a few homes left to sell. To clarify what is included in the purchase price of the model, get the sales agent to enumerate them on an addendum to the purchase contract. You may also ask to have listed what repairs will and will not be done, so that this is clear to both parties as well. The terms of a model home purchase can be more creative than those contained in the usual home contract. Sometimes builders can arrange a purchase-leaseback, asking the buyer to close escrow on the home by a certain date, but accept a fixed monthly rental payment from the builder for marketing purposes. This is generally the principal, interest, taxes and insurance, along with a commitment to pay all utilities and maintenance until you occupy the property. |
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