Save money when buying your new construction home! Building a new home is an exciting journey, but it can quickly become overwhelming—especially when it comes to managing costs. The good news? You can stay on budget with smart planning and strategic decisions. Here are 10 tips to save money during new construction, complete with actionable examples to help you make practical choices.

Budget Wisely

A clear and realistic budget is the foundation of any successful project.  If you want to save money when buying new construction, you definitely need to create a budget and stick to it.  Do not be tempted by things that you don’t need and you can’t afford now.

  • Actionable Example: Use tools like Mint or YNAB to track your spending and determine how much you can save monthly for a contingency fund. Aim for a $10,000 buffer to cover unexpected costs during construction.

Avoid the Upgrades You Can Add Later

Builders often charge a premium for upgrades, but many can be done later for less.

  • Actionable Example: Skip builder-installed kitchen backsplash tiles, which might cost $2,500, and hire a local contractor after move-in for $800. You’ll save money and enjoy more design choices.  Skip the built in bookcases or the cabinets in the laundry room.  You can add them after you move in for a lot less than the builder will charge.   On the other hand, the cost of adding a breakfast room off the kitchen probably will be less if you do it at construction.

Consider Using the Builder Grade Materials to Save Money When Buying New Construction

Standard materials offered by the builder are usually more affordable than upgrades.

  • Actionable Example: If the builder offers oak cabinets as the standard option but charges $4,000 extra for maple, consider sticking with oak. Later, you can refinish or replace the cabinets for less than the upgrade cost.  Do you need the top of the line Sub-Zero appliances right now?  Maybe you can “make do” with Samsung for now?

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Save Money By Spending on Things to Save Money

Sometimes you save money in the long run when buying new construction by spending a little now.  For instance, if you invest in energy-efficient features now, you can save money in the long run.

  • Actionable Example: Spend $2,000 on better insulation or an energy-efficient HVAC system. This can reduce your heating and cooling bills by $100/month, paying for itself in just a few years.  These are the sorts of things that it’s harder to install post construction.

Design Simplicity Will Save You Money

The more complex the design, the higher the cost.

  • Actionable Example: Choose a rectangular floor plan with minimal angles or unique rooflines. This can save $5,000–$15,000 compared to more intricate layouts.

Don’t Overbuild for the Neighborhood – Even Though This is Your Dream Home

Building the biggest or most extravagant house in the neighborhood might not be the best investment.

  • Actionable Example: If most homes in your neighborhood are 2,000 square feet, resist the urge to build a 4,000-square-foot home. It could cost $150,000+ more but may not yield the same value on resale.
  • Even if you are buying new construction in a development, don’t pick the most expensive model and add all the upgrades!  Remember that whatever you choose, you will eventually sell this home you are building.  The most expensive home in the neighborhood is typically harder to sell than the best value on the block.

Careful Timing Can Save Money When Buying New Construction

The timing of your construction project can significantly affect costs.

  • Actionable Example: Start construction on a single home in late fall or winter when builders are less busy. Labor costs can drop by 5–10% during slower months.
  • Near completion of the development: If the builder is close to finishing the project, they may want to close out quickly and be more flexible.  If you are buying new construction in an entire community that is being built by one builder, you should remember that prices go up as a certain number of homes are sold.  Therefore, you are better off purchasing in the beginning of the development when you might have a better selection of lots and the prices are the lowest or purchasing at the end when there are only a few lots remaining and the builder is anxious to close out the sales center and move the staff on to a new project.  The builder may be offering incentives at that point or may be more open to negotiations.
  • End of fiscal quarters or year: Developers may be motivated to meet sales goals and offer better deals during these times.

Monitor Construction Closely

Staying involved during the construction process can help prevent costly mistakes.

  • Actionable Example: Walk through your home weekly if allowed by the builder. If a subcontractor installs the wrong flooring or misses a fixture, catching it early prevents expensive rework later.

Negotiating the Base Price When Buying New Construction

If you are buying new construction in a development and the builder has several homes just like yours to sell, it is unlikely that he will cut the price of your home just for you because he likes you.  If he cuts the price of your home, all the other buyers are going to expect similar pricing.  Therefore, it is probably a waste of time to try to negotiate on price, which is recorded in the land records for everyone to see.  However, no one knows what your new home actually contains at that publicly recorded price.  Instead of asking for a reduction in price, ask for upgrades and extras like a better appliance package, a higher level of cabinetry and carpet or built in bookcases.  These things cost the builder less than he is charging you and they are not reflected in the final sale price,  It is a win win for both sides!

  • Ask for upgrades: Builders might not lower the base price but can include upgrades (e.g., better appliances, countertops, flooring) at no extra cost.
  • Request closing cost assistance: Developers often have room to offer financial incentives to reduce your out-of-pocket expenses.
  • Inquire about warranties: Negotiate for extended warranties or guarantees on the property.

Take Advantage of Builder Incentives and Tax Credits

Look for opportunities to save through rebates, tax credits, or builder promotions.

  • Actionable Example: Check your state’s energy-efficiency rebate programs. For instance, some states offer $500–$1,000 rebates for installing Energy Star-rated appliances or solar panels.  Ask the builder to install these.
  • Sometimes at the end of the construction in a particular project when the builder wants to close out sales, he will offer promotions such as a finished basement or an upgraded flooring package.

Work With an Experienced Realtor

A real estate agent familiar with new developments can provide insights into builder practices and help you negotiate effectively.

It’s exciting to consider buying new construction but you want to get it right because you are paying money before the home is built.  Please call the Lise Howe Group at 240-401-5577 if you would like help navigating and negotiating this process.  As a realtor and associate broker and a recovering lawyer, I love to represent my clients in negotiations for new home construction.   Give us a call or email us at lise@lisehowe.com to start us working on your behalf. 

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