Is it a good idea to buy a “spec” home from a builder or should you stick with your own plans and specs and build a new investment home on your own? That’s a lot of territory to cover and can’t easily be answered without knowing more about each option. But when evaluating a spec home that’sinvesting in a spec home currently under construction is it a good plan?

A spec home is a property under construction that’s speculative. The builder is speculating that due to the current market and property location a buyer can be found for the right price once the home is built rather than building a home based upon plans and specifications provided by an individual.

One of the immediate advantages buying a spec home is the timeline involved. If you’ve considered building a new investor property you’ll encounter a significant amount of legwork before the first shovel of dirt is tossed. You must first explore local building ordinances, codes and pull the necessary building permits. Get utilities to the property and make sure the lot agrees with your building plans. A spec home has already completed the initial phases of construction, shortening the timeline.

What phase of construction is the spec home, are there any changes that you can make without significantly adding to the cost of construction? If so, then you can personalize the property allowing for your tastes to be included in the home. If the home is further along then you may not have many options to switch things around but you may have an advantage for the price of the home if the property is nearly completed yet still no offers or the offers that have arrived are much lower than the builder is willing to accept. Even better, the home is complete and has been listed for sale for quite some time. You may be able to invest in a brand new home cheaper than you may have thought if the builder is getting a little nervous about selling.