Key takeaways
- Buyers make many of the biggest decisions — from lot selection to layout — early in the new‑construction process, often before building begins.
- Production, semi-custom and custom homes offer different levels of flexibility, which affects cost, timelines and how much buyers can personalize.
- Design choices can quickly add up, so buyers should prioritize upgrades that are harder or more expensive to change later, like flooring, countertops and structural options.
Building a new home gives buyers a rare level of control, but that freedom comes with a long list of decisions to make before the first wall goes up. From selecting a lot to choosing finishes, the process can feel overwhelming if you don’t know what to expect.
Production homes offer less customization, but if you want to add something, construction is often the most cost-effective time to do so. Semi-custom gives buyers lots of choices in materials and layout, but the choices in material and layout need to be established before the home is built. Custom homes give buyer complete creative freedom, but the amount of choices can be overwhelming.
Before drafting the purchase agreement, you need to outline what exactly you want to put in the contract. Each upgrade costs money, so discerning what is most cost-effective and important to you is important.
Select the lot
Not all plots of land are equal in value in a subdivision. There are a dozen factors that could influence buyer demand for the land.
Premium lots tend to cost more, but could hold up in value. Size and privacy typically add value to a lot.
"Some lots are pristine — maybe they back up to the woods and they’ll never have anything built behind them," said Ken Harthausen, president of NewDay Home's Builder Division based in Palm Beach, Florida. "Maybe it’s a corner lot and it has a little bit larger sightline. Maybe it’s in the cul-de-sac, and if you have little kids, you won’t have people driving through. So not every lot is the same."
Lots that are less desirable are ones that are on the main road because they will likely have more traffic and noise.
Custom home buyers will have the most freedom in choosing land, but they are also limited by what property is available. If you are looking to be in an urban area or certain neighborhood, you might need to buy a lot with an older home and replace it.
Production homes are typically in subdivisions of land owned by the builder. Depending on when you buy in the construction process, you will have more or fewer choices. Early buyers typically get first choice on premium lots, and latecomers might have to go with what is left.
Choose the floor plan
The floor plan is one of the biggest perks of customizing a new construction home.
For production homes, there are a few layouts to choose from. Semi-custom homes allow buyers to add extra rooms, garage space or extend the living room on the layout.
Custom homes are blank slates, so any floor plan can be drawn up. This gives the buyer the most freedom on the design.
“If you have a game room, that affects the value of your home," Harthausen said.
Adding extra bedrooms, bathrooms or garage space adds value to the home. When considering floor plans, having an extra bedroom or bathroom will increase the resale value.
"It doesn’t matter where you live: A bathroom is a bathroom," Harthausen said. "That’s going to add value. An extra bedroom, an extra half-bath, an extra garage and then a game room — those things really add value.”
In general, garages are valuable, but in markets with extreme weather they are very important.
“And it depends a little bit on where you’re located," Harthausen said. "If you’re in Phoenix, Arizona, the garage is a premium. If you’re in Minnesota, a garage is a premium — where you have severe weather, hot or cold, a garage means a lot.”
Visit a design studio
Some builders will have a designated design studio with the material options they work with. For custom and semi-custom homes, you might visit an independent or boutique design studio or supplier.
The process of picking out the details can be grueling and long. For custom homes, you choose every detail down to the light switch covers. Semi-custom homes give buyers more choice than production homes, but they are not involved in every design choice.
“You don’t have to worry — the buyer doesn’t have to worry — too much about the design of the house," Harthausen said. "Builders hire architects who are up on the newest styles, so you’re not going to build a house that has a huge dining room and a huge living room like something that was in vogue 25 years ago.”
Before you pick the finishes in your home at the design studio, you should try to have a plan or vision of what you want it to look like. Look online for inspiration. Social media apps like Pinterest or Instagram are good sources for inspiration. Take screenshots of rooms you like. Notice the color of the floors, style of the cabinets and paint on the wall.
You might want to hire an interior designer to work with on the design of the kitchen, bathrooms and other living spaces. While the architect will aid in some design elements, interior designers can help curate the finishes to achieve the look you want.
Decide on details
Upgrades add up, so set priorities in the design choices.
“It’s better to buy things that can’t be easily replaced," Harthausen said. "So, for example, granite. Granite is expensive to take out and put new granite in.”
Production homes will be designed for mass appeal with the current design trends. They will likely have bright and neutral colors. For modifications, the buyer might be able to customize the color of the cabinets, flooring and countertops from a set selection.
“So, if you can choose some type of neutral — if you're not going to live there for 30 years and this is a home you're going to live in for three or four years — you’re better off selecting somewhat of a neutral tone,” Harthausen said.
Design choices are not necessarily investments into the home's long-term value, but some choices do impact the value.
"The crown molding, the type of tile you have, the color of the tile, the color of granite — really doesn’t affect the value of the house that much unless it’s some kind of funky color that somebody put in," Harthausen said. "You’ve seen it. You’ve walked into a house and go, 'Holy cow, I’d never buy this. It has a purple counter.'"
Buyers of custom homes and some semi-custom homes will need to pick appliances like ranges, refrigerators and microwaves.
"You get the warranties on all the appliances — every major manufacturer comes with a warranty for that," Harthausen said. "So, in new construction, that’s one of the things you’re protected with. Everything’s new."