If you’re considering buying a new home, you may be wondering if a “spec home” is the right way to go. Crescent Homes Maui, the island’s leading luxury home builder, often offers spec — aka “speculative” — homes for sale. And for many buyers it’s the best choice.
Defining Your Terms
A spec house gets its name because the builder is speculating that he or she can earn a profit based on selling a new home that is move-in ready, in a desirable location, and fairly priced.
A spec home differs from a new custom home in several key ways. First, a custom home is designed from the ground up for an individual client on a specific lot. This allows the client to choose the location of the home, and the way it’s sited, designed, and finished. But the project will typically require the services of a real estate agent, architect, and homebuilder. The design, permitting, excavation and construction can take several months — even without delays or surprises during construction. If you need to relocate your family within a certain time frame — such as before school starts in the fall — building a custom home may not make sense.
Key Features to Expect
Home builders closely follow housing trends so they can offer the features that today’s buyers want. For instance, with the COVID pandemic, many people are working remotely from home. This might require a dedicated office, or a flex room that can be living or office space.
In addition, clients frequently ask for:
- A neighborhood that is desirable, convenient, and/or in a good school district
- An open floor plan that enhances entertaining and socializing
- An ample lanai with outdoor kitchen and easy access to indoor spaces
- Plentiful use of glass windows and doors
- Guest suite as well as separate master suite
- Walk-in closets
- Luxurious master bath with soaking tub and separate shower
Benefits of Buying a Spec Home
Besides on-trend design and amenities, there are other reasons you might choose to buy a spec home. As we noted, a house built on spec is ready for your family to move into soon after the sale. You are also buying new construction, which avoids the repairs or updating that an existing home might require.
Another key benefit of a spec home is that you can walk through it, judge its size and flow and see if it’s a good fit for your family before buying.
If you locate a spec home that is still being completed, builders will often permit buyers to add certain upgrades or changes to finishes. Crescent Homes Maui often offers options that allow buyers to switch out paint or cabinetry colors or choices in countertops or flooring. However, buyers should not expect to make major changes, such as altering floor plans or moving walls.
The Bottom Line
Calvin Baty, owner/manager of Crescent Homes Maui, says that spec homes typically cost slightly more (10 to 15 percent) than a custom home.
“This is because there is the need for a developer profit for taking the speculative risk,“ says Calvin. “When you build a custom home, you get to personalize the home but also tend to save money as you are not paying for the additional profit needed for taking the risk of building a spec home.”
The bottom line is that luxury homes in Hawaii typically cost upwards of $650 per square foot. But it’s important to note that on the islands, land, labor, and materials are more expensive than on the mainland. Some of the other factors that impact the cost of new construction include:
- Supply and locations of lots
- Home values in a particular neighborhood
- Supply and demand of homes in that locale
- Size of home
- Design, amenities, and upgrades
Cons of Spec Homes
If you’ve waited a lifetime for your dream home and have very specific design choices and features in mind, then a spec home may not be right for you. You’ll want to consider the cons of spec homes:
- The design will likely be very similar to many other homes in the builder’s portfolio, or even the same neighborhood or city. Builders construct homes they know will be popular and easy to sell.
- Options for customizing the home will be limited to finishes such as paint and cabinet colors, and countertop materials. The buyer does not get to make major changes to a home.
- You won’t get to choose the location of the property or the neighborhood.
Our best advice is to weigh the pros and cons of spec homes and have a firm idea of your budget. Then, talk to a reputable builder and look at his or her portfolio and see if the homes appeal to you and your family. Buying a spec home may be the smart choice. And remember, while you might save slightly with a custom home, it will take longer to build and require much more of your time and attention.
At Crescent Homes we have decades of experience and have built thousands of homes. When you’re ready to make your move to Maui, call Calvin and let us give you the key to your dream home.