WEST PALM BEACH, Fla. — If at first, you don't succeed, try, try again.
Brand new homes in South Florida are not immune to the outrageous demand in the housing market. Buyers are finding out it all comes down to what you are willing to sacrifice.
Owning a new home has always been Terrance Diaz's dream, but he never foresaw the challenges he would face in a market with little inventory, high demand, and increasing prices.
"It's all about your will. How bad do you want it?" Diaz said.
It turns out you have to want it bad.
"It's definitely way more challenging than it's ever been with new construction," said real estate agent Karen Moody.
Moody said she doesn't always jump at new construction these days. The competition is nothing like she's seen before.
"Some of these buyers are having to put in offers at the sales centers, and they don't know what they'll get," she said. "You go over $100,000; are you competing against the sales center? Or are you competing against another buyer?"
Bidding wars are a new part of the insatiable demand for new homes.
"There is no shortage of buyers," said Tonia Abrahamsson, vice president of sales at Minto Communities, a known developer in the area currently building a master plan neighborhood in western Palm Beach County.
At the Minto Communities' building site located in Westlake off Seminole Pratt Whitney Road, developers build a city within a city.
Even with a plan to build 4,500 homes in the next 10 years, more buyers than lots are available.
"We are limiting the amount of home sites that we release at a time just to control what's going on in the market," Abrahamsson said.
With supply chain issues and worker shortages, Abrahamsson said it's all-new territory for builders who must order materials six months in advance instead of 60 days.
"Initially, when someone came in, in the beginning, prior to the pandemic, and what’s going on, our build time was anywhere from six to eight months," Abrahamsson said. "Now, what we're looking at, about 11 months."
So, what do buyers have to do if they want that new home?
"Me, I'm always reaching for the stars," Diaz said.
Diaz and his wife, Veronica, live in Broward County and set their heart on a brand-new home for their growing family in Westlake.
"They have a resort, living style waterpark. Let's start with that, for the family," he said. "And I'm more excited because I'm back in my hometown, you know, Palm Beach County."
Ken H. Johnson, a real estate economist and Florida Atlantic University's associate dean of graduate programs, said a higher percentage of people move into Palm Beach County than move south to Miami-Dade.
"Palm Beach County, for example, in the next 10 years, is expecting an increase in population of slightly over 14%," Johnson said. "That all puts a strong high demand on homes in Palm Beach County."
For Diaz, that meant it wasn't going to be easy to get his dream home.
"We slept in the back of her SUV, and it was all night, all morning," Diaz said.
He and his wife learned the system to purchase at Sky Cove homes in Westlake. A few lots are released every couple of weeks, but only to those willing to be the first in line.
"You think, how many times am I going to have to do this?" said Veronica Nieto-Diaz, Terrance's wife.
Two times the Diazs waited outside the sales center on release days, hours before the office would open, but were too late. Other buyers arrived before them and got the first pick for the only three lots released.
He arrived 20 hours before lot release time the third time, spending the night in his car.
"When you got there, you took your picture, you signed in," Diaz said. "The tough part is, you couldn't leave; you had to stay."
Not all new developments at Westlake have the same system.
Minto Communities has a confidential electronic system where those buyers on the waiting list are sent an email to submit a form when lots are released.
The first buyers to submit the form get a chance to secure the very few lots released. This process can take months for many buyers before they are first in line.
The Diazs overnight adventure landed them on spot No. 2 out of three. They secured a lot, but it's going to cost more.
Every release date, the lots to build are increasing at different increments. Sometimes those increases are $10,000, $20,000 even up to $40,000.
"Don't go by the signs you're seeing on the road," said Moody regarding homes no longer selling starting in the $300s.
The market's challenges and demand are driving up new builds costs.
"If you keep waiting, prolonging it, it's only going to go up," Diaz said.
While demand is not slowing down, the Diazs are finally in the home stretch.
"A story that we have to tell behind this home," Veronica Nieto-Diaz said.
"It may be our 'Happy New Year' present. At the latest, January of next year, we should be moving in," Diaz said. "It's brand new, from the ground. Yes, American dream."
Realtors say if you have your heart set on a brand-new home, there are a couple of things that can help you above the competition in this market:
- Make sure you are pre-approved for your home loan before you start looking.
- Hiring a real estate agent, even with new construction, can help you deal with the sales centers and building process.
- If you really like one specific developer and location is flexible, check to see what other communities are being built by the same company.