How to reduce costs and risks when buying a new house.

There's something appealing about a brand new house -- you get to pick out the carpet, drapes, and appliances, and have everything designed just the way you want it. New houses often come with more space and better appliances, require less immediate fix-up work, and are more energy-efficient. New houses are also sometimes priced more reasonably than comparable old ones. To get a good sense of the new house development in your area, visit http://www.homebuilder.com.

But, there's a downside. Too often, the advantages of new houses are overshadowed by problems such as shoddy construction and lengthy construction delays. Here are some suggestions on how to avoid problems.

Choose the Developer, Then the House

The most important factor in buying a new house is not what you buy (that is, the particular model), but rather who you buy it from. A responsible builder understands that he or she has a reputation to protect, constructs homes that live up to their promises, and remains available should issues arise. More than a few builders, however, take your money, throw together a house that starts falling apart on day one, and then stop returning phone calls. The message is, don't buy a house -- buy its builder.

To check out a builder, contact:

• owners who live in the development you're considering, if possible. If the development is run by a homeowners' association, talk to the association members and the board of directors. If nothing has been built yet, talk to owners in a recently completed development by the same builder.

• county planning or building department staff who deal with local developers. For the best results, ask your questions positively. "Do Brady and Jones finish their projects on time, with few complaints?" will probably be answered candidly, but "Is it true Brady and Jones is a real schlock outfit?" might not be.
• real estate agents who've worked in the area for some time. Agents won't usually deal directly with new house sales, but they may have handled the resale of houses built by developers and may know their reputations.
• the state or local licensing or consumer protection agency that oversees contractors, and the local Better Business Bureau. Ask whether any complaints have been filed against the developer.
• other homeowners, via homeowner-run websites such as http://www.hadd.com (Homeowners Against Deficient Dwellings) and http://www.hobb.org (Homeowners for Better Building).

Have the House Inspected

Hire an experienced contractor or home inspector to evaluate the house you're considering for the quality of construction. When a house is being worked on, it's easy to see whether construction standards are high or not. If your house isn't built yet or is already finished, have the inspector or contractor look at other houses the developer is in the process of building.

Even if the home is finished when you buy it, hire a home inspector to give it a thorough examination. Also, you should visit your home site periodically during construction and take the final walk-through to catch last minute cosmetic defects.

Be Wary of Optional Add-Ons

Many developers advertise houses at comparatively low prices to get you to come out and have a look. Once there, commissioned salespeople show you models loaded with expensive extras such as a spa, fireplace, granite countertops, and giant bathrooms. If you become seriously interested, the advertised price will rise as you decide that certain extras are essential or irresistible.

Buying extras lets you semi-custom design your home. But ask yourself what you really need and how much it will cost. Upgrades often add 5% to 20% to the cost of a new home. To get the most for your money, follow these steps:

1. Take care of essentials first. Be practical, both for your own sake and for the sake of your home's resale value. A fenced yard (especially if you have children or pets), more electrical outlets, wiring for high-speed Internet access, and, in many areas, air conditioning, are day-to-day necessities. A hot tub and wine cellar are not.
2. Make sure prices are fair. Some developers are less ethical in pricing extras than others. Steer clear of those who deliberately use poor-quality materials in highly visible spots in their models, almost forcing you to upgrade to over-priced substitutes.
3. Negotiate. Ask for one free extra for every two you buy. For example, if you pay top dollar for good carpets and kitchen cabinets, ask the developer to throw in a better stove at no charge. And don't be afraid to ask for the right to buy and install extras on your own instead of paying high prices for the developer's.
4. Read the fine print. Many new house contracts contain a clause saying that the model's features, such as carpets and appliances, are not necessarily the same brands you'll receive. You are guaranteed only the functional equivalent of what you see, which is typically different and costs the builder far less. Make a list of the precise features you're concerned about (with brands or makes and models) and include it in your contract. If one developer won't accommodate you, shop elsewhere.
5. Get it in writing.When dealing with a developer's sales representative, get all promises as to what will be done, and when, in writing. Before you sign the purchase contract, make sure it includes every one of the agreed-on changes. If you've already signed the contract when you negotiate changes, write them down in a separate document and have the developer or the sales representative sign it. Don't rely on oral commitments, which are notoriously unreliable and almost impossible to enforce.