Aneta Janiak-Olejnik

Purchase and Sale Agreement for New Construction

When purchasing a new construction home, it is important to have a purchase and sale agreement in place. This document outlines the terms and conditions of the sale, protecting both the buyer and the seller. Here are some key points to consider when drafting a purchase and sale agreement for new construction.

Property Description: The agreement should include a detailed description of the property being sold, including the lot number and any specific features or upgrades that have been agreed upon.

Purchase Price: The purchase price of the property should be clearly stated in the agreement, along with any contingencies or conditions that may affect the final amount.

Deposit: The agreement should specify the amount of the deposit and when it is due. It is common for new construction sales to require a larger deposit than traditional home sales due to the significant upfront costs associated with building a new home.

Closing Date: The agreement should include a closing date, taking into account any factors that may affect the timeline of construction. It is important to have a realistic timeline to avoid any delays or misunderstandings.

Warranties: New construction homes typically come with warranties from the builder or manufacturer for specific components such as the roof, HVAC system, or appliances. The purchase and sale agreement should outline these warranties and any limitations or exclusions.

Contingencies: The agreement should include any contingencies that must be met before the sale can be completed, such as obtaining financing or passing a home inspection. These contingencies protect the buyer in case the property does not meet their expectations.

Closing Costs: The agreement should specify which party is responsible for paying certain closing costs, such as title insurance or transfer taxes. It is important to have a clear understanding of these costs before finalizing the sale.

Dispute Resolution: In the event of a dispute, the agreement should outline the steps that must be taken to resolve the issue, such as arbitration or mediation.

By including these key elements in a purchase and sale agreement for new construction, both the buyer and the seller can have peace of mind knowing that their interests are protected. Working with an experienced real estate attorney can ensure that the agreement is legally sound and enforceable.