Building or buying a New Construction Home in Miami? This is the ultimate Guide to New Home Construction, Remodeling or buying a ‘new build’

The ultimate guide for building or buying a new home in Miami

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2. This is a sellers market with low inventory and rising prices

The Miami market is seeing a very low inventory and newly built homes are those that sell fastest. The favorable Florida Tax climate and the pandemic is leading to a large influx of buyers from high tax states. The pandemic has also led to a new reality in which people realize they need a home with an office, a larger home or a completely different lifestyle in general. Finally Low tax rates resulted in local buyers pulling the trigger.

Most of my buyers are looking for “newer homes” so if the general market is selling fast you can imagine how fast these new homes are selling. As a result of this tight inventory builders are increasing their asking prices or various buyers are bidding against each other. Those buyers who lock in on a deal today might get a significant appreciation before the home has even closed or has been built.

3. There is not a lot of room for negotiation

We know everyone is currently looking for a great deal. But please be aware that the Miami market is divided into condos and homes. Condos for sure are great for good deals at this moment, but homes are more and more becoming a sellers market with rising prices.  Therefore there tends to be little room to negotiate. This doesn’t mean there are no discounts, but buyers need to be realistic. Sellers know they can sell to someone else so even though discounts can be given, there is a clear bottom line.

Builders often use other incentives such as different options and upgrades as well as lower closing costs with use of one of their preferred lenders. Outside of those incentives, don’t expect there to be much wiggle room. Be aware that some homes might be built on less desirable lots or were custom built for end-users that did not come through. These kind of homes might have specific features that are not for everyone and this might lead to a better negotiation position although when reselling the next buyer will use the same reasons to lower the price.

4. Contingencies and timelines

Delays always happen and even more so with Covid-19. This is particularly true if you build from the ground up or if you purchase early in the process. Building materials and interior finishes like cabinets or flooring might take longer to arrive. Crews could potentially be challenged if someone gets sick. The process might not go exactly according to the initial projected plan.  Allow yourself some float in case that happens, and plan accordingly with interim accommodations.

If you are planning to build from scratch, a builder might be a bit more flexible in doing a contingent contract for a limited amount of time, such as 60 days to find a buyer for the buyers’ property. The bottom line is, if you have to sell to buy, you really should have your home actively listed with a real estate agent before going under contract on new construction.

David’s current Coral Gables home has been completely renovated and expanded. See more ‘before and after’ pictures by clicking on the link to follow and read about the financial upsides of remodeling a Miami house.