New home vocabulary: Descriptors
The world of home buying boasts a jargon all of its own. From loan qualification to appraisal and valuation to closing costs and fees, the raft of terminology can seem overwhelming. In the new home realm, the process of building adds a layer of industry lingo to the picture.
Home descriptors alone are apt to confuse a novice prospect. There are semi-custom homes, production homes and inventory homes. There’s even something called a quick move-in home. What do these terms mean, and most importantly, what do they offer the buyer? Below is a casual survey:
Semi-Custom
Fairly common to new Bay Area communities, the semi-custom home is a convenient combination of the production home and the all-out custom home. Buyers can take advantage of some floor plan flexibility without the time-consuming, painstaking process of fully custom construction. In addition to selecting your own fixtures and finishes, you’ll also have the option of adding or deleting a wall, or even an entire room, from the standard plan. Upgrading a garage to accommodate not two
but three cars is another possibility. Some luxury builders even allow buyers to add a second-story to a single-level floor plan.
Moreover, you may have wider latitude as to fixtures and finishes than the production home buyer who must choose from a preapproved list of options. A semi-custom home might also rescue a buyer from some of the unexpected delays inherent to custom building a house. Production
A production home allows the buyer to choose from among a handful of standardized floor plans. They are constructed according to a builder’s preset schedule, according to Fleming. These homes are typically offered for sale prior to the start of construction. A buyer who gets into contract prior to, or during the early phases of construction will have a chance to select all of the home’s finishes — flooring, cabinetry, countertops and fixtures — from a predetermined list of options. Quick Move-In / Inventory
Quick move-In homes are at or near completion and can be move-in ready within 60 days. For the most part, the buyer will have to live with whatever design options the builder has selected. “These homes appeal to someone who wants or needs to move quickly,” says Fleming. There can also be financial advantages. “A buyer who is concerned about interest rates, can lock in the rate because the home will be done soon,” she reports.
An inventory home is a dwelling whose construction is complete, according to Marci Hemenez of Dividend Homes. In some cases, a home is finished before the developer has identified a buyer. In others, a home becomes available because a buyer has backed out of a contract. Generally, builders are eager to get both inventory and quick move-in homes off their hands, so may offer considerable sales incentives.
Practically speaking, the above home types are distinguished by pricing, move-in and design option availability. Understanding their relative advantages will ideally allow the prospective buyer to conduct a more intelligent search.