Negotiations with home builder... what was your approach?

[cycosis]

Many members on here have built homes and Im curious as to how much potential negotiation room there is on the stated prices/upgrades.

Range of 500-600k for budget. Were you able to get free upgrades on flooring? Maybe the blinds tossed in?

Never considered building before but it looks to be an interesting avenue.

[03ozwhip]

I got my deck extended by 50sqf for free, a better appliance allowance and the best by far, a walk out basement...mind you I had to switch communities to get that, but the was by far a better choice, as it turns out, the community is 10x better, albeit they are both brand new communities.

[cycosis]

Only one response???

[imranm]

Anecdotally - I am seeing that ~$500k market continue to sell so I don't know if there are a ton of discounts to be had.

Upgraded flooring and blinds - I really can't see that being a huge issue if you aren't trying to drive down the price much.

I would say go in with a list of your wants, and see where they go. Different builders/neighborhoods seem to have more/less negotiating room.

Good Luck!

[Kloubek]

I think it all depends on a multitude of factors. What are their margins (on both the base house, as well as upgrades)? Do they have enough business to keep themselves out of the red or are they desperate for business? Is where you are looking moving inventory, or is it stagnant?

I'm building right now with Reidbuilt. I signed well into the downturn. They already offer discounts on upgrades. Once you hit $_______ upgrades, they kick you back $_________. Go up a tier to $________ of upgrades, they bump up the kickback to #______. Etc. As a result, they have cut their own margins for the upgrades, which is where the builders typically earn their higher margins I think.

In addition to Reidbuilt, I was also working with Broadview in another community, and bouncing what we were getting per price between the salespeople from both companies. Reidbuilt was originally unwilling to provide me with any additional discount, but they did end up caving to the tune of 4g I think once I told them I wanted to buy with them, but that Broadview was providing a compelling offer.

Broadview, on the other hand, came way down from their original price. The salesperson worked very hard to accommodate us, and we ended up with a decent deal for the house we were considering. In the end, there were reasons we went with Reidbuilt anyway, but certainly not due to Broadview not giving it their best shot with reductions.

So in short, it varies so much that I don't think anyone can give you a black and white guide. All I can suggest is to push them for the best deal, and don't be afraid to play them off each other. That way, you are a "look what I can get elsewhere" kind of person rather than a "I just want better savings" person.

[gwill]

if your getting kick backs from the builders make sure this isnt on any documents provided to your mortgage lender.

cycosis- if a builders rep refuses to write the offer youll know your way out to lunch. What your asking for isnt unreasonable and some of what your asking for is typically a standard option with many builders.

A builder would prefer to provide upgrades for free as they can claim its a larger discount.