It may seem counterintuitive to shop for a new home in December because of all the other seasonal activities competing for your attention. However, if you’re thinking of delaying your new home search until a month from now, you may want to reconsider.
Here’s why: Many local homebuilders offer extra incentives at year’s end and have an abundance of what are known as ‘inventory’, ‘spec’ or ‘quick-move-in’ homes — those that are completely or at least partially built — and they’re often available for fairly speedy occupancy. (For some examples of currently available quick-move-in homes, check out our “Year-End-Clearance Move-In-Ready Guide” on pages 6 and 7 of this section.)
The advantage of choosing an inventory home, said Kevin Rosinski, division vice president of Toll Brothers, is that you don’t have to wait for several months before moving into your new home. An inventory home typically is ready for move-in between a month and three months after signing the purchase documents, compared to about six months for a yet-to-be-built home.
“Your new home isn’t starting from the ground up,” Rosinski said. Toll Brothers maintains 13 communities in the Phoenix metropolitan area; about 11 homes are available for quick move-in.
An inventory home, depending on its phase of construction when you purchase it, can be ready for move-in in as little as a month, said Andy Pedersen, group vice president of marketing and merchandising for K. Hovnanian Homes in Arizona, California and Texas. “Depending on financing, you can buy a move-in-ready home right now and potentially be in the house in 30 days,” Pedersen said.
K. Hovnanian has 17 active new-home communities in the Valley and approximately 30 inventory homes available.
Frequent builder incentives
Some builders may include extras with the inventory home at no additional charge — perhaps a free refrigerator, window coverings, a washer-dryer set or free front-yard landscaping, said Trey Bitteker, general sales manager for PulteGroup which builds Pulte and Del Webb Homes. PulteGroup maintains 19 neighborhoods in the Phoenix metro area; about 80 homes are available for quick move-in.
Inventory homes often carry a higher discount than those that haven’t been built yet, Bitteker explained, because many, if not all, of the options are finalized which leaves a buyer with fewer opportunities to personalize the home. Generally, he said, you can expect to pay $3,000 to $20,000 less for an inventory home than for a comparable floor plan that still needs to be built.
In addition, if the inventory home is still under construction, Rosinski said, “there may be an opportunity to make some personalization selections” — perhaps flooring or paint color, for example.
“A move-in-ready home offers today’s technology, energy-efficiencies and cutting-edge design without having to wait for a six- to eight-month build cycle,” said Dana Spencer, director of sales and marketing and the designated broker for Woodside Homes in Mesa. “Most importantly, the buyer will be the very first resident of the home.”
Spencer said that buyers should be sure to ask the builder what features of the home are included in the full purchase price and about the terms of the home warranty. Woodside offers 11 neighborhoods in Greater Phoenix with about 10 homes available for quick move-in.
Additional advantages of a quick-move-in home
Locking-in the price and interest rate: With home prices rising and the direction of interest rates uncertain, the sooner you buy, the sooner you can lock-in a price and a mortgage interest rate. And though the rate of the upswing has slowed compared to a few years ago, home prices in the Phoenix area still are on the rise. The Case-Shiller Home Price Index released at the end of October shows that in metropolitan Phoenix, home prices climbed just a whisper under 5 percent between August 2014 and the end of August 2015.
Possible tax advantages: There may be tax advantages for you, too. If you close escrow by Dec. 31, said Ken Peterson, vice president of sales and marketing for Shea Homes, your loan origination fee, points and other closing costs may be deductible, thus reducing your 2015 tax obligation. Shea Homes maintains
14 communities in the Phoenix metro area; as many as 18 homes are available for quick move-in.
Exciting start to the new year: By buying before the end of the year, you can enjoy the psychological boost of starting 2016 knowing your biggest decisions are behind you, not ahead of you. “You’ll have the excitement of moving into something brand-new that has the ideal floor plan for your family,” Pedersen of K. Hovnanian said.
Easier move-in date than with a resale home: Having to negotiate a move-in day is less likely with an inventory home than with a resale home. With a resale home, you may have to come to terms with the current owner about the escrow closing. “When we’re nearing important holidays, an owner may want to wait longer to move out,” Peterson said. With a new home, he said, you are the first owner. You don’t have to wait for anyone to leave.
The ultimate gift: Perhaps the best reason to consider buying a builder’s inventory home before the end of the year: a new home for the holidays is
the optimal gift for the entire family, Spencer said.