Closing costs on new homes vs resales

In Marion County the seller traditionally pays for title insurance and a tile company handles the closing. The seller pays Documentary Stamps a Florida tax on the sale of a home that is .007 % of the sale price. Unlike resales new home builders don’t pay either for title insurance or Doc Stamps. On a $200,000- home Title Ins. and Doc Stamps would ad up to $2700- +/-.

Some builders offer incentives, a fee at closing to the buyers. These vary by the builder and depend on how sales are doing. You might see them on a Spec home that has been there a while, a model that isn’t the most popular or a home on a less desirable lot. Incentives can offset closing costs.

Buying an Ocala retirement home for cash

Most of my buyers are looking for a retirement home and quite a few use money from the sale of an existing home in a more expensive part of the country to buy a home for cash here in Ocala. A lot of people don’t like the idea of not having a mortgage hanging over their heads in their retirement years. What some buyers don’t realize is that there are very few closing costs associated with a cash sale.

All of the big money for closing costs come from getting a loan. It is up to the bank to estimate closing costs associated with their loans. From what I have seen closing costs run between $5-$7K on most loans. The funny thing is closing costs can be crazy high on small loans. I saw a buyer get a $50K loan to suppliment cash he had and the closing costs were 5,000 ! I said that’s 10% !

Title and closing. The seller here pays for title insurance and doc stamps (tax on sale). A title company researches the title and delivers a full warranty deed. The title company handles everything to do with the closing.

HOA fees are pro rated to the day of closing. Some HOA’s have a set up fee and a couple have an HOA contribution fee. Some HOA’s want a month or 2 in advance to get started.

Inspections. Everyone needs a professional home inspection which includes a termite inspection. Many get a wind mitigation certificate for their insurance company which lowers the rate a little. An inspection will run in the $350 +/- range depending on what you inspect.

Survey. Being cash there is no bank that requires a survey. 55+ communities are planned communities. However is you don’t get a survey there will be an exclusion on your title insurance saying that you didn’t provide a survey. Most buyers get a survey but not all do. A survey even on a small lot like in 55+ will be $300 +/-.


Just sold a new home in JB Ranch

JB Ranch entry sign

JB Ranch is a new 55+ community here in Ocala. It is located off SR 200 and couldn’t be in a better location. I haven’t done a blog profile yet because the community is so new the clubhouse is under construction. There are 2 national builders there DR Horton and Lennar Homes. Both are offering new homes for very close to the price per square foot of a resale.

I just sold a new home by Lennar. I was impressed by the standard features. The kitchen has 42″ upper cabinets, quartz counter tops and really nice GE appliances standard.. A washer and dryer are also standard something you never see in new homes. . The master bath has a walk in tiled Roman shower. It is a smart home with all sorts of new smart features that I’m just getting up to speed on. All at the prices of a nice resale around $100- to $115 sqft of living area.

See a few pictures below

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New homes in Ocala Florida

New home building has started to pick up in the Ocala and surrounding Marion County Florida area. For the longest time new home building was dead. Starting in maybe 2015 things picked up and now there is new construction popping up around the county.

Where. Not 55+ homes are being built in Silver Springs Shores, Marion Oaks, Ocala Park Estates, Heathbrook, Oak Hill Plantation, Ocala Waterway and Meadow Glenn to name a few areas with a fair amount of new homes. The 55+ communities with new home construction are JB Ranch, Del Webb Stone Creek, On Top of the World including Candler Hills and Indigo East and Trilogy Ocala Preserve.

Price. Prices vary quite a bit. Excluding very high end homes prices run from about $100- Sqft to $150 sqft. That is sqft of living area, the area that is heated and cooled.

Upgrades. Although there are spec homes that you can buy either finished or almost finished a lot of new homes are semi custom. I was told by a salesperson at a large 55+ that a good ballpark number for upgrades is to add 20% to the base price you often see advertised.

If you are interested in a new homes call me. Using a Realtor doesn’t effect the price of a new home. I can also show you alternatives such as resales just a few years old. New home sales people are employees of the builder just like a car salesperson.

New home prices in Ocala Florida

Below is an article I saw in the Florida Realtors newsletter that I get every day. It talks about new home prices and how builders can’t afford to build lower priced homes. I think this is something buyers don’t understand. This is especially important to understanding new and newer home prices in Ocala. When the real estate market crashed in 2007 home prices fell too low for builders to build new homes. No one started a major new subdivision until just last year. Many resales were selling for $70 to $90 sqft of living area when new home builders need $110 to $130 sqft minimum to make money. This shows that prices don’t just go down for new homes builders stop building. There still are lower priced homes here but they are from the 80’s to the early 2000’s. Newer homes, 2004+, are at a premium as so few new homes were built during the Great Recession. That is not to say newer home prices here in Ocala are high. In fact they are quite low compared to some other parts of the country.

Lower-priced homes ? Builders can’t do it

CHICAGO – June 13, 2016 – Builders find it increasingly difficult to build a home for under $150,000, despite rising consumer demand for more affordable home options.

The median sales price of a new single-family home in 2015 was just under $300,000, according to the National Association of Home Builders; and about 78 percent of new homes were priced between $150,000 and $500,000. Less than 6 percent were priced under $150,000, and an even smaller share was priced under $100,000.

Yet, a 2015 Home Buyer Preference Survey conducted by NAHB shows that 31 percent of recent or prospective home shoppers say they expect to pay less than $150,000 for a home. Fifteen percent expect to pay under $100,000.

“The costs of acquiring land, developing it into a lot and constructing a home on it often make it impossible to produce a new home at a price substantially below $150,000,” NAHB notes on its blog, Eye on Housing.

Government regulation on a new home alone accounts for 24.3 percent of the price of the home – or about $84,000 based on the average new-home price.

“Cost factors like these leave little mystery about why the lower 30 percent of the home buying public is often restricted to the market for existing homes,” NAHB notes.

Source: “New House Price Data Shows Why Costs Are a Problem,” National Association of Home Builders’ Eye on Housing blog (June 6, 2016)

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