Are new-construction townhomes a good investment in the current market?

Asked by J & L, Greater Baltimore area Mon Apr 7, 2008

I have seen 2600 sf townhomes for $340k in the Glen Burnie area, and can reasonably afford a $2700/mo payment (P&I, Taxes, Ins, etc) that this price would require.

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4
June Piper-B…, Agent, Baltimore, MD
Fri Jul 31, 2009
Buying a home is always a good investment. There are a lot of great opportunities through builders right now because the market has been slow. You can sometimes negotiate a much better build out on new construction now than on a resale unit. However, there are some fabulous deals out there on resale homes too. You can find some great opportunities at http://www.advancerealtyaa.com if you aren't already working with an agent.
0 votes
Donnelly Gro…, Agent, Millersville, MD
Sun Apr 12, 2009
Hi J&L,
The good news is that now is a great time to buy from builders. See, the housing market, as you know is down. It is down for builders and regular sellers as well. The difference is that the builder reports to wall street and needs to make their stated sales plan. As a result, they are typically more responsive to the depressed market than a seller would be. A regular seller doesn't have the deep pockets that the builder has.
Additionally, the builder can take various actions to keep his costs down. For example, they may change what is included in the sales price, they may reduce what the incentive for the month would be, they can talk to the developer to reduce the costs of the land, they can talk to the vendors for a reduction in trade, etc. A regular seller doesn't have these options at their disposal.
Now is a great time to buy new construction. In my opinion, it is a better time to buy new construction than a resale.
I worked for a local builder for 13 years and understand the strategies of the builders.
Please let me know how I can help. Diane
0 votes
Choice World…, Agent, Annapolis, MD
Wed Feb 18, 2009
Hey J & L,
I just wanted to see if you ever bought that townhome?
David
0 votes
Chris Highla…, Agent, Frederick, MD
Mon Apr 7, 2008
J & L,
Many builders are having troubles and are in the position to give great deals. They, like every other business, will take what the market will give them. The market gave them big profits in the heyday, and now they are in the position to change their profit structure to stay in business. If you like the house, are comfortable with the payment, the rates are favorable (and they are), and you are going to stay there for 5+ years, then by all means, find a buyers agent to help you negotiate with the builder for a good deal. Best Wishes.
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