What are the Main Types of House Builders?

The main types of house builders today consist of three main types: the speculative house builders, the production house builders, and the custom house builders. While variations and hybrids have happened with these three types of house builders, their work is almost the same.

Being able to identify the various functions of these house builders enables a potential homeowner to find their perfect match.

The Three Main Types of House Builders

Getting the perfect house builder based on your preferences and budget is by identifying the three main types, namely:

Production/Tract House Builders

Production house builders or tract home builders are worth considering when you cannot afford the services of custom or high-end house builders. Many areas of the world today feature homes built by production home builders.

The future in house building seems to belong to production house builders. It is because of the affordability of production homes featuring the same stock plans and builder options.

The hundreds of homes built by production house builders year in and year out are their downside. The inflexibility of the home designs without any diversity does not conform to building outside the box.

The customised limitations of production homes are perfectly understood by production builders. The pre-sold term used by these types of home build informs buyers about the type of construction.

Pre-sold homes provide buyers with two options:

  • The builder owns the house until the buyer pays it in full
  • Construction products can either be bought by the buyer during construction or once construction has been completed.

Customers hiring production builders to construct a customised home may encounter a few problems. Building a customised home is often outside the comfort zone of production builders, leading to problems in construction.

Custom House Builders

Custom house builders are the option when you want anything you need to be built in your home. The things that can limit custom home builders include:

  • Your imagination
  • Regulations of your selected location
  • Your budget

The only thing that can make custom builders start building is a buyer. Custom builders cannot offer completed and vacant homes for viewing because of this.

Flexibility in pricing is also not a strong point with custom house builders. They usually demand a lot of fees for customised floor plans needing the help of an architect. The usual upfront deposit required by custom home builders ranges between 5% and 10%.

Speculative House Builders

Speculative or spec builders are aptly named for they do not need a buyer to start their speculating home build. These types of builders speculate to sell the built home for a profit upon completion.

Not having a buyer to make them start building makes speculative builders function like production/tract builders. However, unlike tract builders owning large lots or land, spec builders buy only a single lot before building.

Some spec builders often hire local real estate agents to handle the sales side of their business. Many homes being sold in local home listings are often speculative homes.

Being able to understand the type of builder you have hired sets expectations. Sometimes, getting the best price and concessions from a builder is through an agent having working arrangements with various local builders. We build houses that people are happy to call home. Contact us to know more about us.