Buyers will sometimes ask “is Builder X a good builder?” My answer is that your builder’s brand name doesn’t matter enough to make it a decision point in your new home purchase decision.
In other words, if a hypothetical buyer is torn between two similar to-be-built home options in the same neighborhood, I will tell that buyer that the brand name of the builder should NOT be a deciding factor. There are more important things such as the lot itself, the floorplan and standard finish-out.
But I read some bad reviews about Builder X?
Ignore those. You cannot protect yourself from a bad builder experience by ruling any builders out, and you cannot increase your chances of a good builder experience by limiting which builders you consider. Researching builders is folly. The same builder can build two houses side by side, and those two different buyers may have completely different experiences. In fact, one project may go smooth, and the other has a lot of problems. Each build is its own standalone project with its own unique and different problems that will arise, because the lots, floorplans and buyers are all different. That’s normal and expected.
In Texas, as in most Sunbelt states, all the “production builders” use the essentially same pool of subcontractors. It’s not that different from the PC you buy (Dell vs HP), or even many appliances and cars. Drive through the neighborhoods and you’ll see trucks from Casa Mechanical and Chistianson Plumbing working in the same subdivisions on different builder’s home. Few builders have in-house framing crews anymore. All sub out the roofing. All trades get subcontracted out now. It’s these subcontractors that do the work, not the “builder”, which isn’t really a “builder” in the strict sense of the word, but a construction management and marketing company.
One of my buyers wrote an offer on a new home the other day. Not a completed “spec” home, but a “to be built”. While we can write an offer for a resale home in 15-30 minutes, signed, sealed and delivered (which sometimes isn’t fast enough in this Austin market), a new to be built home is a long, arduous sit-down in the builder’s onsite rep. We were there for over three hours. And this already knowing exactly what the buyer wanted except for just a few exterior items and colors. It just takes that long to write everything up, print it and go through it all.
Anyway, at some point going through the massive stack of builder contract paperwork with my buyer, a nasty little addendum emerged, the likes of which I’ve never personally seen. “Whoa, what’s this?”, I say.
It’s a document that imposes requirements on the private third party inspector that the buyer may hire to inspect a home. It requires that the inspector sign a document called a “Access Agreement for Home Inspection”. The access agreement requires that the inspector have:
Proof of General liability Insurance of at least $1,000,000
Proof of Auto Liability Insurance of at least $100,000
Proof of Worker’s Compensation Insurance equal to the “statutory minimum”.
Proof of Employer’s Liability Insurance of at least $1,000,000
So I dialed up my new home inspector while we sat there and asked about this. He said it’s total BS. A ploy by builders to limit inspections. He doesn’t meet the requirements, nor do most Texas Real Estate Inspectors (TREC requires $100K liability, so most carry the minimum), much less the Code Inspectors you want to be using on a new build.
Does this mean my buyer can’t use my over-credentialed, highly competent and trustworthy inspector? The builder was happy to offer a list of inspectors they have who do meet the requirements. No thanks. I want my buyer to have my inspector, not yours. So now what?