Q: Is building/purchasing a new home still a smart investment in light of the COVID 19 pandemic?
A: Nosan Signature Homes: Absolutely! We are in a recession largely due to high unemployment and small business failures that began earlier this year. However, interest rates remain low and there is a shortage of used homes that are move-in ready. Construction opened back up on May 7th, 2020 under new safe work rules, and it is likely we will continue to work this way for the foreseeable future. Real estate sales also restarted under new rules to ensure proper protocol is followed including social distancing and PPE.
This is new territory for the U.S., but it appears that staying at home and working from home will be the new normal for some time to come. The activities we value outside our home, including trips to the gym, movie theaters, etc., may not feel safe or necessary anymore. That means that more than ever, the comfort, efficiency, and right mix of rooms (home office, exercise room, theaters, etc.) will be in demand, yet not readily available in existing housing stock. New homes and substantial remodeling are the only way to address these needs. . For these reasons we think new homes prices will continue to rise and smartly remodeled homes will retain and even increase in value.
FAQS - BUILDING YOUR HOME IN BLOOMFIELD HILLS
Building a custom home is a large undertaking. In this guide, we teach you how to build the custom home you want while loving the process - how to get started, timelines, change orders, financing, warranties, and more. Take a look and contact us to schedule your Idea Session. We’re here to help!
Q: I want to build a new home, what does “design build” mean?
A: Design build is a fairly new concept that means you work collaboratively to design and construct your new home to a predetermined budget. This collaboration is generally between you (the owner) and a builder with design capabilities. The builder may use an in-house or outside designer or architect. The team may also include an interior designer, surveyor, landscape designer and other contractors or consultants. When you work collaboratively you set your budget and the team works within those parameters. Where compromise is needed, you get to make the call during the design process based on solid information provided by the team.
At Nosan Signature Homes, we have an in-house designer that works with you in real time to design a home that meets your needs and budget. Once we’ve landed on a mostly finalized design, we then enlist an architect to complete the design and structure of the home. Ultimately, you’re able to be more involved in a design build project and stick closer to budget.
While architect led projects can lead to beautiful results, we’ve seen many that also lead to disappointingly high costs. Working with a collaborative design build approach ensures you stay in control and work in a cost-conscious manner to achieve superior aesthetic results.
Q: I'm interested in building a new home but I don't know the first thing about purchasing land or construction.
A: First, evaluate all your options. Then determine if building from the ground up, finding an existing home that meets your needs as is, or completing a renovation is best for you.
Either way, the process can be fraught with uncertainty, so we recommend finding a builder who offers you full services, starting with your property search. A builder who can also help you purchase property and understand the costs associated with building on it or renovating, gives you the added benefit of having a team in place for the entire lifecycle of your project, helping you establish a timeline and budget while minimizing risk.
When you buy property with the intention to build or renovate, optimizing your purchase price, minimizing your costs, and understanding the seller's position is especially important. A traditional buyer’s agent will charge the seller 3% of the purchase price (that’s $15,000 on a $500,000 property!).
When you retain Nosan Signature Homes to complete your new build, addition, or renovation, besides our expertise, we offer the same brokerage services at a lower flat rate to the seller, $10,000 on a purchase up to $499,000 and $15,000 for those over. That savings ultimately is passed on to you and can be put towards bonus features in your new home!
Q: Why does new construction always seem to cost more than resale?
A: Resale pricing is purely market driven whereas new construction pricing is typically based on many factors including cost of land, labor, materials, and profit margin for the builder. This formula for new construction will generally add up to more than comparable square footage and location in a resale home.
Nearly all homes will appreciate over the years. The amount the owner paid and what it is worth today usually results in “profit” when/if the owner sells. Most builders compare the price required to cover costs and make a profit to existing homes when evaluating new projects. We advise our clients to review the resale market extensively before they undertake the new construction process. If you find something at a lower price per square foot on the market that checks most or all your boxes, that will be the most cost-conscious option.
New construction allows you to “right size” your new home and choose interior and exterior styles, amenities and finishes to ensure your home meets your sense of style and needs. You will likely have lower maintenance and operating costs since current building codes and energy efficiency standards are met. To top it off, we think it’s always nice to soak in a brand-new tub!
These questions and answers are part of our series with Hour Detroit about custom homebuilding in Bloomfield Area and surrounding areas.