Fairfax, Loudoun County Virginia -Residential Real Estate Market Blog

Things You Should Know When Buying Builder's Model Home

Don't we all love walking through those beautifully decorated model homes in the Fairfax & Loudoun County area. I know few home owners who would go model home browsing to get ideas to decorate their home. This is wonderful!!

Most of the builders want to sell off the model before they are sold out of the community or through the sale of their community.

Since the models are so gorgeous buyers over look all the details that go into while purchasing a model home from the builder.


You may make pose some questions,such as:

• To begin your purchase start with asking for a sheet of all the itemize items that will be included as a part of model home sale.
• What repairs will and will not be done by the occupancy date?
• How will the walkways be converted (sometimes they are linked to the next model home)?
• When will you permit occupancy, and if it is not within my time frame, will you close escrow and lease it back from me? (If this is the case, be sure that they continue to pay for maintenance, utilities, and security, in addition to your principal, interest, taxes and insurance)
• If I wish, may I keep matching linens and custom-sized area carpets?
• May I purchase some of the furniture and if so, for what price?
• When does the clock start ticking on my new home warranty and the appliances and systems installed? (The model home may have already seen several years of service.)
• Are you sure the home will appraise at the sales price we have agreed to?
• Most of the builders convert their garage space into sales office, most will convert them back into a garage and remove any window or doors to meet the building codes. What will be removed to convert them back?

Understanding Financing:

There are builders who try to sell their model homes early and arrange a leaseback, with an agreement with the new owner to give them a 30-60 day notice for the model’s conversion and/or lease termination. This arrangement lessens the builder’s monthly carry and gives the new owner a target date for occupancy. Although the builder will tell you that they would LIKE to be finished there by spring of next year, it will be difficult to pin him down for specific dates. Your occupancy date will depend on how quickly the neighborhood sells out, and that depends on the community’s popularity with homebuyers and market conditions.

Should you agree to purchase and rent back the model home and occupancy is still a ways off, you may have to arrange non-owner-occupied type financing if you are not paying cash for the house. Lenders will generally not permit an owner-occupied type loan on a model home purchase, since it will not be your principal residence, and you have effectively become the landlord. Understand your financing and the cost to be a landlord.

Just because it has all the fancy feature it does not necessary means you have to pay that premium compared to the homes to be built. Just like a regular home sell you need to negotiate with the purchase price on the model home. Have an experience Realtor represent you and negotiate the fair market value taking into consideration the wear and tear the model go through and the current market condition.

Cheaper to built to suit or model home?

Well the model homes are definitely spruce up with lot of custom options that may be not available or increases the cost when you built to suit. With these features/upgrade included it comes with a premium price also. As mentioned above have an experience Realtor have you do a cost analysis of the model home compared to the homes to be built. What are the features you can live without if you did not buy the model home? Adjust those and some upgrades you did not care off and see where you are heading on your numbers. Don't buy into sales pitch that just because it's a model you end up paying the highest price in the neighborhood!!

What are the drawbacks of buying model home?
Biggest drawbacks about the model homes are they are built on the crappiest home site. What does that mean? Well simply this, builders are very smart they locate their model homes at the front of their neighborhoods on the main road where they will get the most access and be most viewable to the public. This drives traffic to a builder’s doorstep allowing them to sell more homes. However this isn’t typically a good thing for you who want to enjoy your new home, because you’re located on the main street to the entire neighborhood you’re looking at dealing with a lot more traffic and noise.

The other drawback, home inspectors can vouch for is the quality of construction of the model home. Since builder is in a rush to get the model up they do a rush job. My recommendation would be even if you buy built to suit or model home get a home inspection.

Third drawback, is the home decor. Yes, the model looked gorgeous with the staged furniture but once the model is converted into your regular home the wall paper that went well with the home looks ugly and outdated.

Lastly the model home you had fallen in love aged. What does that mean??? Well the construction was done "n" year back and now you have bought the home from that year built rather than "new construction". Also with the wear and tear the model home goes through during the 1000 of people walking into the model home. That level 4 upgraded hardwood flooring will be nicks and dents more than an average home goes through during the same period or longer period. That is just one component of the home think about the other areas.