Buying a New Construction Home With D.R Horton.

Is a new construction Florida Home the right real estate choice for you? 

I just got done building my home with Dr. Horton the nation’s largest new construction home builder right here in Vero Beach. In this blog I'm going to go over my experience with Dr. Horton and the pros and cons I had built my home with them.  I'm going to give you all the nitty gritty details that I learned that you need to know if you’re considering buying a new construction home.

 I'm going to try to answer all the questions you may have but if I don't get to your specific question feel free to reach out to me by phone or e-mail and we can have a more in-depth conversation. I’m a real estate agent here on Florida’s east coast and I’d love to help in your home search.  With that being said, lets get right into it.

Beginning The Home Search

I started my home search in the beginning of 2023 when rates were floating around 7%. First, I started looking at resale homes around 325,000 since that's what I was able to get approved for when buying a resale home. In January I put in a full price 325,00k offer on a property that was a three-bedroom 2 bath home with 1350 square feet. However, I like many others in this crazy market was outbid and the house went for over asking price. I was gutted, I felt defeated and for the first time I felt the disappointment and uncertainty that some of my buyers’ clients have felt, and it was humbling.

 It was at that time where I took a step back, extended my timeline, and started looking at other options. I always had new construction in the back of my mind but thought I wouldn't get approved for it since I only got approved for 325,000 when buying resale homes. I had a fantastic conversation with my mortgage lender and she informed me that with the builders special interest rates, lower insurance costs, and closing costs credits I would be able to afford much more when buying a new construction home compared to a resale home. Shortly after our conversation I got approved for 350k, and just like that I started diving into the world of new construction. About two weeks after I got approved, I got informed by Dr. Horton Rep that they were planning to build a Cali model on a vacant lot here in Vero beach. It was everything I was looking for, it was in the perfect location, the floorplan I wanted, and the price I wanted, so needless to say, I bought it that day.

New Construction VS Resale

I was able to buy the Cali model from Dr. Horton which is a four-bedroom 2 two-bathroom home that has 1828 square feet and it cost $343,000. The home sits on 1/4 acre, and has a canal and preserve in the back so I don't have to worry about neighbors building there. I built on a spot lot in the Vero beach highlands which means it's in a non gated non HOA community.

Compared to the home I put an offer on at 325,000, this new construction home had 500 extra square feet an extra bedroom it was on 1/4 acre instead of .17 acres, it was built in 2023 instead of 2005, and it backed up to a preserve. One would think that the 1300 sqft home that I got outbid on would have a smaller monthly payment than the new construction home, right? Theres where you’d be mistaken, and the main reason why I ultimately chose to go with new construction.

New Construction Intrest Rates and Benifits 

Dr Horton often offers special interest rates if you use their in-house lender, DHI Mortgage. With DHI Mortgage I was able to get a 4.99% interest rate when rates were floating around 7%. 

Keep in mind that for every 1% of interest rate that you can save, your payment will go down hundreds of dollars per month. So, for me getting a 2% lower interest rate was going to save me anywhere from 450-550 dollars per month, or roughly 5-6k less in interest per year. Over the life of my 30-year loan that equates to $150,000 less in interest that I will have to pay, which is incredible.

 In addition, they also contributed $18,000 towards my closing costs.  If you can believe it or not, I'm only out of pocket roughly $10,000 for this home, and that was the initial $10,000 deposit I had to put down in January. In addition, when buying a new construction home, you'll have more options for insurance. I was able to get a $1500 insurance plan through one of Florida’s top insurance providers frontline. Keep in mind you can go with other insurance companies that are cheaper, but they cover less. The lowest insurance I got quoted on was around 950 per year. On top of that everything in your house is going to be brand new from your roof to your flooring to your countertops to your appliances you won't have to worry about fixing them or having insurance issues for a very long time.

New Construction Problems 

Now admittedly not everything is all sunshines and rainbows when it comes to buying a new construction house and there were some hiccups in the process that made it frustrating, let me explain.

Originally, they estimated this home to be done September 15^th. Around halfway through the building process they were making a good time and they moved up the estimated completion date to August 1^st. Once they got to the stage where they needed to connect power to the home, Florida power and light took 5 weeks to connect my home to power which pushed back the completion date to October. On top of that a berm needed to be redone in my backyard which pushed out completion a week further, so we ended up closing October 16th. So, we went from planning to move into the home on August 1st to actually moving in the 16^th. If you're buying on a spot lot this is absolutely something you need to consider before you buy. It's different if you're in a community because it's very streamlined, but if you're buying a new construction on a spot lot you have consider that potential delay. For me it wasn't a big deal since I had family to stay with however if you're coming down from out of state this can be a huge issue and cause a lot of stress. I can only imagine if I was out of state and I planned movers and everything for August 1^st, only for it to close 2 1/2 months later. We were so excited to get into our new home, so that the last 2 1/2 months really drained us because we were already mentally checked out and ready to move from the family place.

Another hiccup was with my mortgage lender. To get the special interest rate and 18k in closing credits you must go with Dr. Horton’s lender DHI mortgage. During the process my original loan officer either got fired or quit and was no longer working with the company. My file was supposed to get transferred to another loan officer to take over, but it wasn’t. So, there was a good month or two that I didn’t hear from my loan officer and I was in the dark. I reached out to her through email and by phone call numerous times and never got a response. I finally told other DR Horton reps, and figured out she was no longer working for the company and only then did I get a message from a new loan officer. Silver lining to this was my new loan officer named John was really awesome and he was always on the ball looking out for my best interests.

I was also disappointed in the lack of customization options I got because I bought a spot Lots. The buying process for spot lots is a little different compared to the buying process for a new construction home in a HOA community. With spot lots, Dr. Horton has already ordered materials specifically for my build, so I had zero options when it came to customizing furnishings, tile, countertops, etcetera. When buying in an HOA community a lot of times you have more customization options and the building process is more streamlined. So, with no customization options, my house came with tile in the main living area, carpet in the bedrooms, and Formica countertops throughout. For me this works for my budget, but I know for others they're going to want options when it comes to upgrades and that is not something a spot lot can get you with DR Horton. One thing I was able to change was the paint color of the outside of my house. I went with the tan color for the exterior, with black paint for the accents on the door and shutters.

Another inconvenience when buying a new construction home would be that it comes completely unfurnished and when I say completely unfurnished, I mean completely unfurnished. Not only will you need furniture such as couches, tables, chairs beds etcetera for each room you will also need to buy extra light fixtures, fans, blinds, curtains, I'm talking everything. And I don't know if you all have been home decor shopping recently, but the prices are ridiculous. For each fan it was $170 and for each blind it was $180, so just to get lights and a little bit of privacy it was $350 for each room, So in total I spent $1400 in just fans and blinds. Another thing you'll want to do is paint the interior because it comes in shell white. They do this to lower costs and give you the option to paint whatever interior color you want. I was able to paint the main living areas but if you have to hire it out know that that is probably going to cost you a few thousand dollars. In addition, most of DR Horton homes don't come with a washer dryer or refrigerator, so you'll have to budget for that. Keep in mind that some communities do you offer appliances, so this the appliance package depends on the community you build in.

Some other very little things that were frustrating were for some reason my door was painted brown instead of black like I wanted. And it was that really gross color brown that looks like you know what, so needless to say I had them change that immediately. And lastly I thought communication could have been a little bit better.

Overall New Construction Experience

Even with these inconveniences overall I'm extremely happy with my new home. Compared to buying an older resale home it just doesn't make any sense. If I were to find a replica of this exact same house on the market, I'd be looking at paying upwards of 400K or more with an 8% interest rate.

So right away it's nice to know that I have equity in my home and if anything, ever went wrong I could always sell and make a quick buck. You know I always tell people if you have the luxury of time and patience I always would recommend buying a new construction home. You'll pay significantly less compared to resale, you'll have a discounted interest rate, you'll get your closing cost paid for, and you'll have a brand-new home that you won't have to worry about for years to come.

So, everyone that was my experience building with Dr. Horton, I hope that this was valuable and informative to you if you have any other questions, please don't hesitate to reach out.

Spencer Bailey

507-951-2934

Spencer.bailey507@gmail.com