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To Be Built or Built on Spec?

Sierra in North Port Deland Florida
The Sierra with Optional Stone front

Everyday I get people asking what homes we have built that are ready to move into.  It happens so often we have special section of our web page for “Express Delivery Homes” just click on the button and you get a list of every home that is available in the entire region.  If you have looked at our list of Express Delivery Homes you will find that it is very short.  Many of the questions come from Realtors that have a client that appreciates the advantages of buying new, but the Realtor has a vested interest in a fast closing, so they want the builders to keep an inventory of “Specs” available at all times

What is a “Spec”.  A spec, is a home built on speculation.  The speculation that there will be a buyer for that specific home near the time the home is completed.  The builder decides what options to include in the home and what colors are neutral enough not to scare any potential clients away and starts the home.  The builder sets a price that includes “carry cost” that is roughly what the monthly payments for the home are, times the number of months the builder can expect to hold the home waiting for a buyer to show up and get their mortgage approved.  In a strong market this might be 90 days (three months).  Six weeks to find a buyer once the home is complete and four to six weeks for the buyer to get a mortgage approved and close on the home.   In a less than strong market it can be quite a bit more. 

Some builders choose to keep an inventory of Spec’s available and understandably Realtors frequently love them.  But if you think about it, would you rather have the money you spend on a home go toward what goes into the home OR would you rather have a significant portion of the cost be paying to have the home ready at a moment’s notice?  That is the difference between a new home from a builder that offers “Spec’s” and one that tells you it will take four to six months to build your home.  Does the money the builder spends to pay the bank on that completed home improve the quality of the home?  Does the money the builder spends mowing the grass and watering the lawn increase the homes value to you?   Do you get any benefit from the manufacturers warranties being shortened since most are based on the Certificate of Occupancy date rather than the closing date?

Doesn’t it make more sense to plan ahead, give your builder the time to build your home and move in when it’s complete?  That way the home is built for you,  with your selections and your colors.  At Maronda Homes it takes about six months to permit a home and build it.  Wouldn’t you rather have the money you spend on your home go into the materials and labor that went into your home, rather than the bank that financed the home, the insurance company that insured the completed home, the utilities spent on the completed home?  Visit a Maronda Community and start planning today.

About Tom Greenawalt

Tom is a Licensed Builder in the State of Florida. He has been in the construction industry for 35 years building new homes in Pittsburgh, Washington DC, and Chicago before moving to Central Florida. The majority of Tom's career has on detached housing for entry level and first time move up buyers. He was with Maronda Homes for over 15 years.

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