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October 21st, 2021 at 11:00 am

Exterior view of a spec house

Finding the home of your dreams is one of the most amazing feelings, but it comes with plenty of complications. Some of which include how long does it take to build a new house or even how much does it cost to build a new house. While you can rely on experts like the team at Berkshire Hathaway HomeServices California Properties to help you through the process, knowing where to start can come with its own difficulties.

One of the first things you have to think about when you begin your search for a new home is deciding the type of home to go with. You have your choice of functional but uniform tract homes, or you may have the budget for completely custom blueprints to create a home that is unique to your specific needs.

The third option is a spec house, but what are spec homes? Read on to learn more about spec houses, their benefits, and their potential drawbacks.

What are spec homes?

You generally have your choice of three different types of home builds. The first is tract homes. What are tract homes, you ask? Tract home builders purchase large tracts of land that they can then divide into dozens (sometimes hundreds) of smaller plots. They then build homes on those plots, though these home designs are often limited to the same three to five floorplans with some limited custom finishes. On the other hand, you have custom home builders, who build completely customized homes based on specs and design ideas from the buyer.

Spec (short for “speculative”) homes are built from floor plans pre-determined by the builder. The home can contain features designed for a wider audience, but the homebuilder also has a specific home buyer in mind, like a first-time homeowner or a young family with children, as they design the home.

Spec homes are an interesting middle ground between tract homes and custom homes. Like tract homebuilders, spec home builders purchase plots of land and build their own designs without an actual buyer lined up. It’s basically a pre-built home intended for a potential homeowner. The expectation is that prospective buyers will buy the homes when they are move-in ready, hence the “speculative” part of spec homes.

However, like custom homes, spec homes offer more variability and uniqueness than tract homes. While you don’t have the full freedom of a custom home, you generally have more options for customization than with a tract home. A spec home builder may have some set options for features throughout the home, allowing you to pick any of the components you want.

The benefits of a speculative home

A spec home may seem like too much of a compromise for someone who wants a fully custom home, but it can still offer numerous benefits for the potential buyer.

Affordable price

One of the biggest benefits of a spec home is the price. Granted, specific prices can vary based on countless factors, particularly location. However, in general, spec homes are surprisingly affordable, especially compared to fully custom builds. That affordability has given many people the wrong idea about spec homes, which get a reputation for being cheaply made.

While it is true that spec homes are affordable, that lower price tag does not come from low-quality materials. In fact, spec homebuilders invest a great deal of money and time on blueprints and floorplans that they know will become sturdy and durable homes that they can reliably build over and over.

The true reason that spec homes are more affordable is the efficiency of construction and labor. The designs of each home take into account the sturdiness of materials and the ease of execution to cut down on costs. Builders are also incentivized to sell their homes faster to recoup on their investments.

Shorter timeline

Tract homes are still the fastest builds, taking about five to six months for full construction. However, spec homes are still faster than custom homes. A spec home can take about a year to build, while a truly custom home can take a few years.

The real advantage is that spec homebuilders already know their timeline. They design their floor plans with a specific building schedule in mind to ensure consistency and reliability. It factors in and plans for any potential disruptions or stoppages. Even if you ask for specific customizations, a spec home will likely have a shorter timeline than a custom house.

Some customizations

Builders are constantly setting up new developments, meaning you can easily find spec homes in their early days of construction. That gives you a better chance of working with the builder to implement more customizations than you think. The exact nature of those customizations will vary from builder to builder, but in the early days of construction, you can have a surprising amount of control without pushing back the timeline of the build. 

Availability and speed of move-in

Spec homes are also known as “move-in ready homes,” and for good reason. With a custom home, you may not actually see a move-in date for upwards of a year or more. Spec homes eliminate much of the lengthy wait time and bureaucracy involved with a custom home. A custom home requires excess planning, working with an architect, and getting all the permits and paperwork, all of which happens before actual construction even begins.

For a spec home, you can ostensibly look at a home one day, make the purchase the next, and move in within a few weeks. That level of speed and accessibility is nearly impossible with a custom house.

Less risk

If or when you move out, you hopefully want to sell your house for a profit. That is still wholly possible in older homes, which can and do appreciate, but that often requires a great deal of maintenance and an investment of time and money. That could include replacing old appliances and repairing older components.

A spec home is naturally built with new appliances and materials. That should give you some peace of mind as the home has a better chance of appreciating without you needing to put more money into it.

Ready when you are

A spec home is ready for you to move in as soon as you walk through it. That means that every appliance is working, all the utilities are functional, and every cabinet and door is neatly in place. That makes the purchasing process so much easier on you. You don’t have to spend time with any concerns about the design of your home or any permits or inspections that have to be made. You simply have to think about how to move in and all the memories that you’ll make.

Good amenities

Spec homes are designed and built by experienced builders who are also knowledgeable about current popular trends. They make all the important decisions regarding design, appliances, cabinetry, and beyond, all based on what customers have liked before. That ultimately equates to a home that offers stylish amenities.

The potential drawbacks to a spec home

Spec houses do not generally have a lot of downsides. Much of it comes down to personal preferences and needs. Some potential drawbacks that you might want to consider:

Some rigidity

Spec houses do come with a surprising number of customizations, more than you would see in a tract house. However, a lot of that also hinges on you finding a spec house that is in its early stages of construction and development. Otherwise, the house will look fairly uniform to others in the area, and you likely won’t have the opportunity to make drastic changes to the overall look and design. That may not be a problem for some people who can add most of their character to interior décor, but if you want to make significant exterior modifications, expect to pay for it.

Uniformity

Related to the above, without much control over exterior design and construction, the final version of your spec house will look a lot like the other houses in the neighborhood. That might not be a problem if all you are looking for is a solid, reliable house, but if you are looking for a home with a unique aesthetic and character, you might want to look elsewhere.

Builders want a quick sell

Buying a home is an important decision, and it is perfectly reasonable to weigh out your options and figure out what is best for your situation. However, spec home builders may not be so accommodating to that slow speed. They want a quick sell to prevent the home from sitting on the market for too long. If they already have plenty of buyers lining up for their spec homes, they might not be patient enough to allow for any waffling or foot-dragging.

Who should buy a spec home?

Spec homes are great for just about anyone from any lifestyle. However, they are ideal for prospective homeowners who are not interested in tract homes but do not have the means to commit to a custom build.

Spec homes are also an excellent option for families who are relocating to a different city or neighborhood. Due to the quick turnaround time with spec homes, you can move in quickly and make sure the kids are enrolled at their new school by September.

Spec homes offer a wide range of benefits and some potential drawbacks, but they are ultimately a great option for anyone who wants to live in a new home. Consult the team at Berkshire Hathaway HomeServices California Properties to learn more. 

Sources: Home Decor Bliss, New Home Source, Professor House

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