Purchasing a newly constructed home is a stimulating opportunity, one that awakens the imagination and inspires a fresh approach to the property acquisition process. Customarily, buyers select one of two primary methods when becoming involved in a new construction purchase. An architect and a builder can be employed to construct a custom home on a parcel of land, or a house can be bought after the construction process is already underway. Either method allows for a varying degree of creative control and influence on the buyer's part. Conversely, both options introduce consumers to many specialized factors to be taken into consideration.

One notable difference in the transaction is the type of real estate contract used in the purchase of the property. On existing properties, buyers use the "Standard Real Estate Contract" provided by the Real Estate Commission. For new construction properties, builder contracts should be used to appropriately address specific issues and circumstances. We suggest negotiating the following items with the builder in advance. (Please be aware there may be numerous additional issues that are not mentioned below):

• CLOSING DATE - There are so many elements involved when building a home, parties may not always know the exact date that the property will be completed. There are several ways the closing date can be defined in the contract. Some of the factors that can delay a closing include: adverse weather, sub-contractor problems, and material delays. It is important to reach an agreement with the builder regarding penalties and allowances, should the property not close within the time frame upon which both parties have agreed.
• WARRANTIES - A typical warranty of one year is offered by the builder to repair or replace defects in construction. The exact terms should be clarified in the contract.
• PUNCH LIST - Buyers can usually expect to find minor tasks not yet completed by the builder, even after time of closing. Buyers should catalogue these items, composing a 'punch list'. An agreement should be reached between both parties specifying a time frame in which the contents of the punch list will be finished. An escrow account of funds to cover the cost of these items can be established by the title company at closing, if necessary.
• CHANGE ORDERS - One of the enjoyable aspects of purchasing during the construction stage is the ability to customize the property. Be sure to fully discuss with the builder which items can be changed without additional cost. If a change order is agreed upon, make sure both parties have signed off on the change. Be aware that changes at this stage can increase construction costs quickly.
• INSPECTIONS - It is recommended a licensed home inspector be hired to ensure the property is in the condition expected.
• CLOSING TERMS - If a lending company is involved in the transaction, there may be specific requirements in order to fund the loan. A key issue to be discussed with the lender and the builder is whether a 'Certifciate of Occupancy' or a 'Temporary Certificate of Occupancy' is necessary to close on the property. The definitive difference lies in the level of completion of the structure. Buyers should be sure that they are aware of the variances of certificates and that specific, mutually agreeable terms are stated in the sales contract.

Developers in the Vail Valley are in the process of designing a handful of exclusive new communities so depending upon your needs, opportunities for new construction may be limited. When you are ready to explore your 'new construction' options, please e-mail us your requirements. We will make every conceivable effort to relate your criteria to a current project, or put you in connection with land and established professionals that meet with your objectives.

Our sales team has many years' of experience working with reputable builders and developers. We've cultivated the type of harmonious relationship necessary to create an uncomplicated, successful transaction. There is no doubt that the building process can present even the most seasoned real estate buyer with a fresh miscellany of challenges. Choosing to be represented by the team of real estate professionals at Altima Group, Inc. will equip you with the knowledge and experience necessary to negotiate the process more easily.