The Illume in Chicago’s West Loop

New Construction 101

An Interview with LMKS Group Co-Founder Laura McGreal

Why is new construction an expertise for LMKS Group?

Karen Schwartz and I started ourr career in real estate working for one of the largest developers in the nation. We went through extensive training including courses on financing, marketing, strategic marketing and pricing analysis, construction and energy efficiency. On top of that, we learned the “ins and outs” of the builders including things that may or may not be included in base pricing, what upgrades to include at certain price points, closing cost credits offered with preferred lenders and so much more. We’ve taken on projects from the initial land purchase process all the way through completion. Project sizes we’ve experienced include construction as small as a one tear down lot to the grand opening and completion of developments with several hundred homes.

What is the benefit to purchasing new construction?

There are SO many benefits to purchasing new construction.  Almost everyone loves a brand new home with all of the latest modern finishes and of course that new home smell. Even though most new construction comes with a higher price tag, we remind our clients that the higher price tag usually comes with a builder’s warranty (which is typically at least one year at the minimum).  It also comes with new mechanicals, windows, roof, siding, etc which can be high priced items to replace on an existing home. Finally, new homes mean new energy codes so utility costs are usually lower making your monthly expenses less.

Anything to know when navigating a new construction purchase?

YES! There’s quite a bit to know, but I think that one of the most important things to understand about a new home and different builders is that not everything can be compared on a price-per-square-foot basis. So many things can affect this with the first being the obvious – location. Where the home is located can dramatically increase the cost of the home. There are many other factors to consider as well including size of the lot, quality of finishes and reputation of the builder.

When new construction isn’t yet built, but you’re selling it, this may provoke some fears for people with timing, etc. Any advice for purchasers?

Yes, we’ve sold many new construction homes that were built and closed when we originally anticipated… and many that have not.  There are many factors to consider here including the size of the projects, stage of approvals (has the project been approved by the neighborhood and the municipalities, have they applied for permit, have they built this same home before, how much experience does the builder have in the market they are building in, does the builder have the financing in place to start and also complete the project?). Other things that can be fearful for most buyers are understanding the quality of finishes and whether their home will look like what they are thinking.

 

All in all, purchasing new construction can be a great decision, but we highly encourage using a broker who is experienced in selling new construction so they can navigate through everything listed above and many more things that take place during the process. The LMKS Group has over 15 years of experience selling new construction and more importantly, we’ve worked on BOTH sides of the transaction (developer side and new home buyer side).