New Construction

New Construction in Tennessee

What to know about New Construction.

The team has no New Construction listing to show here yet. Below: what to know before you buy, from Find a Home’s own New Construction page, and where to start looking.

A new home comes with its own paperwork: the builder’s contract, the builder’s warranty, the builder’s preferred lender and fees that resale buyers never see.

1. 01

   Who represents you

   The sales agent in a model home usually works for the builder. A Tennessee licensee must tell you, before providing services, whether they represent you, the seller or neither. You can bring your own agent, and some builders have rules about registering your agent at the first visit, so ask before you walk in.

   Sources: Tenn. Code Ann. 62-13-405 · NAR: consumer guide to written buyer agreements

2. 02

   The builder’s contract and warranty

   Read the completion date and delay terms, change orders, allowances, the earnest money terms, arbitration, the warranty language and the HOA declaration. Tennessee courts recognize an implied warranty against major structural defects only when the written contract is silent, and a builder’s contract can replace or disclaim it in writing. A Tennessee real estate attorney can review it.

   Source: Tennessee Supreme Court, 1982: 632 S.W.2d 538

3. 03

   Licensing, codes and inspections

   A Tennessee contractor license is required for any project costing $25,000 or more, materials and labor included. Check a builder’s license at verify.tn.gov. Many Middle Tennessee counties and cities run their own permits and inspections, and you can also hire your own inspector before the pour and before drywall, if the contract allows site access.

   Sources: Tennessee Board for Licensing Contractors · verify.tn.gov · Tennessee State Fire Marshal: residential permits

4. 04

   Fees that come with new homes

   Many counties and cities charge one-time growth fees on new homes, such as impact fees and facilities taxes. Ask the builder which fees apply to your lot and whether the price includes them.

   Sources: Rutherford County: School Facilities Tax · City of Murfreesboro: impact fee · Sumner County: Adequate Facilities Tax · Williamson County: education impact fee

5. 05

   Property taxes on a new home

   Tennessee values property as of January 1. A home still under construction that day is assessed on the value of its materials, and a home finished between January 1 and September 1 gets a prorated assessment for the rest of that year, so the first bill can be small and the next one larger.

   Source: Tenn. Code Ann. 67-5-603

6. 06

   Financing

   A seller may not require you to buy title insurance from a particular company, and using a builder’s affiliated lender or title company can’t be required. Every lender gives a standard Loan Estimate within three business days of an application, so a builder’s preferred lender is easy to compare with others. Rate locks commonly run 30, 45 or 60 days, so match the lock to a realistic completion date.

   Sources: 12 U.S.C. 2608 · CFPB: Regulation X, 1024.15 · CFPB: what is a Loan Estimate? · CFPB: what is a rate lock?

7. 07

   Building on your own lot

   Where there’s no public sewer, Tennessee requires approval of the septic plans and the lot’s suitability before a home can be built. Read the recorded restrictions and order a survey before you close on the lot.

   Source: Tenn. Code Ann. 68-221-406

From Find a Home’s own New Construction page, which cites a source for each fact: tennessee.findahome.com/new-construction

Information only, not legal or lending advice. Fees and codes change; confirm with the county or city, the builder and your lender.