Most people shopping in Tucson right now assume new construction is the expensive option, the thing you look at after you've given up on finding a deal on a resale. I think that's backwards. Not because new homes are cheap, plenty of them aren't, but because of one thing almost nobody thinks about: when you buy a house from a person who owns it, they have exactly one lever. Price. That's it. They've got a mortgage and a number they can't go under, and that is their entire negotiation.

A builder, on the other hand, has five levers. And they can pull all five on the same house in the same week, almost none of which is on the sign out front. In fact, a lot of what is on that sign isn't what it actually looks like either. As I'm recording this, there's a builder here advertising a 2.75% interest rate on a 30-year fixed mortgage. Their own term pages say the rate is 4.75%. That gap is the whole story.

The affordability problem in this city is real. But new construction is the one corner of this market where there are still five ways to move the number instead of just one. And before I get into any of that, I want to tell you about something we keep because it's the most useful thing I have and it's free: a list of the most negotiable new construction homes in Tucson. You won't find it on Zillow, you won't find it on Realtor.com, you can't Google it, and you can't ask ChatGPT for it either. It doesn't exist on the internet. It exists because we're in these sales offices every single week writing contracts, asking questions most buyers don't know to ask. Link is in the description below.

Stay to the end because I'm going to walk you through one deal where every piece of this lined up all at once: over $110,000 in incentives on one single house. And I'll show you exactly what made that possible.

Table of Contents

• The 5 Ways Builders Negotiate (and Why It Matters)
• Builder Rate Buydowns: The Advertised Rate Isn't Your Rate
• The 10-Second APR Test That Sorts Real Offers from Teasers
• Permanent Buydown vs. Price Cut: The Two That Are Actually Real
• Spec Home vs. Building New: Where the Deals Are
• Best Time to Buy New Construction (3 Timing Levers)
• The Throttle: How Hard to Push
• Do You Need an Agent for New Construction?
• The $110,000 Deal: How All Three Timing Levers Lined Up
• Which Strategy Is Right for You?
• Conclusion

The 5 Ways Builders Negotiate (and Why It Matters)

Let me name the five ways builders have flexibility to negotiate, because it's really the whole argument in this video. Number one, they can cut the price. Two, they can buy down your interest rate. Three, they can pay your closing costs. Four, they can throw in options that would have cost you additional money at the design center. And five, they can do all four of these at the same time on the same house. A private seller can do exactly one of these, maybe two, and only if their math allows it.

That is the affordability answer, and it's the whole reason this video exists. It isn't that new construction is cheaper. Sometimes it's more expensive. It's that there are more ways to move the number with new builds. And in a market like we have right now, where affordability is one of the biggest concerns growing week after week, the five ways we can negotiate with builders versus a resale is a big, big difference when it comes to your affordability and finding you the best deal.

But every one of those levers comes with a catch, and the catch is never written on the sign out front of the sales office. So let's start with the one that fools most people.

Builder Rate Buydowns: The Advertised Rate Isn't Your Rate

There are four ways a builder can sell you rate. Two are real and two are not what they look like.

Number one, the one-year teaser. That's the 2.75% from the top of the video. Now, it's a real offer. It's just that the rate is 4.75% and the number on the sign is your first 12 months. I'm not accusing anybody of anything. That's their own published disclosure. And they're entitled to advertise that starting number. But if you're budgeting on 2.75%, you've budgeted one year of your life.

Number two, the adjustable rate in disguise. Another builder advertises 3.25%. Their disclosure calls it an FHA 5/1 adjustable rate mortgage, fixed 60 months, then it adjusts every single year, ceiling at 8.25%. A third advertises 3.99%, a 7/6 ARM, fixed for the first seven years, then it floats at a maximum just under 9%. And here's their own published example because it's the clearest thing in this video. Their sample payment is about $2,400 a month for seven years. After it adjusts to the maximum, about $3,700. That's $1,300 a month, and it's written in their fine print, not mine.

The 10-Second APR Test That Sorts Real Offers from Teasers

Here's how you sort out all four of these in about 10 seconds without knowing anything about mortgages. Look at the gap between the rate and the APR. 2.75% against an APR of 5.9%. 3.25% against 6.87%. Those are enormous gaps, and a gap like that means the lower number doesn't last.

Now look at a different one. 5.5% against an APR of 5.61%. Almost no gap at all. That one is real. And I want you to notice something because it's the whole lesson. The honest offer is the one with the highest number on it. Hold on to that because it's how we got $110,000 on one house.

Permanent Buydown vs. Price Cut: The Two That Are Actually Real

Number three, the permanent buydown. This is where the builder spends real money to lower your rate for the entire loan, not just the first year, not just the first seven years, not just five years, the entire 30-year loan. One builder here is offering 4.75% on an FHA loan, 30-year fixed with an APR of 5.7%. Look at that gap again. It's tiny. That's what a real rate looks like.

Now let me show you what that's worth, because this is the whole affordability argument in one number. The market rate on a 30-year fixed right now is just over 7%. A year ago it was 6.30%. That's what you get on a resale house because a person selling their house cannot buy down your rate, at least definitely not to the extent that a builder can. They don't have that lever, they don't have that additional capital. And to be honest with you, they don't have the lender relationships to even make that happen to the same extent that a builder would be able to.

So take two identical houses at $300,000. One's a resale at 7%. The other one is a brand new build where the builder bought down the rate to 3.5%. Same price, same house, $650 a month apart. The biggest difference is going to be one's brand new with warranties and never been lived in. The other one is going to be resale with who knows how old it is, how well it's been taken care of, or the overall condition.

Now, I told you at the top, the low interest rate usually isn't permanent, and that's still true on a lot of these. That 3.5% is year one or years one through five. But I don't want you to hear that and think that the savings aren't real. They are. That $650 is money that does not leave your account in year one. That's not a trick. That's an actual discount. But it just has a clock on it. So the question isn't whether it's real, it's which years you're buying.

If you're planning to refinance or your income is climbing or you just need a first couple of years to be survivable, a buydown is genuinely worth a lot. If you're going to be in that house with the same income in year four, you need to know what year four costs you before you sign. And if you want the version with no clock on it, that builder's 5.5% fixed for 30 years, again, 7% on a resale. On a $400,000 home, that's about $400 a month, and it never changes.

One more thing and then I'll move on. Don't let anybody compare an FHA rate to a conventional rate for you without saying so. FHA carries mortgage insurance that a conventional loan at 20% down doesn't. Same loan type to same loan type, then ask your lender what the actual number is.

Two catches. Number one, nearly every one of these is limited to quick move-in homes, standing inventory with the builder. The rate and the house are a package. You don't get to individually pick each one. Two, the credit requirement is the least advertised number in this business. One of those offers needs a 780 score. That's in the very, very fine print, not on the front of the sign when you walk in the sales office.

And number four, the price cut. No rate at all. The builder just lowers the price. One builder here is showing homes that were $485,000, now $445,000. Another was showing at $512,000, now $476,000. And that's the most valuable of the four by a mile. A rate buydown is a discount on your payment, and the day you refinance, it's gone. A price cut is permanent. It lowers the actual loan, what you owe on day one and every single day after that. And it resets the comparable sales for every single house in the subdivision, including yours.

And here's something I noticed pulling all of this information together that genuinely surprised me. Most builders in this town have stopped publishing their rates at all. Three of the biggest names here have zero rate figures anywhere on their websites. Everything else routes to "talk to our sales counselor." One of them still has a rate page up where every single date on it is from two years ago, which tells you something important. If it isn't on the website, the only way to find out is to ask. And what you're asking about matters as much as when you're asking because not every new home negotiates the same way.

Spec Home vs. Building New: Where the Deals Are

There are two completely different things people mean by new construction, and they do not negotiate the same way at all. A ground-up build is when you pick a lot, you pick a floor plan, you pick your options, and they build it for you. Takes the better part of a year. I would say five to eight months typically for a production house. Custom homes are taking anywhere from 12 to 24 months depending on where on the spectrum of custom it lands and what type of finishes and design elements and all that sort of stuff.

A spec home, however, some builders call it inventory or quick move-in homes, is a house the builder has already built on their own dime without a buyer. It's finished, or at least nearly finished, and it's just sitting there. And that difference is everything because of one thing: the builder already spent the money.

On a ground-up build, they haven't poured the foundation yet. If you walk away, they still own the lot, and the lot holds its value. On a spec home, they have a finished house with a kitchen in it sitting empty every single month. It's costing them. They want that cash back. They do not want to be holding it.

So in my experience, and it is consistent enough that I'd stake a lot on it, the most aggressive negotiating we do is almost always on spec homes that can close inside of about 90 days. Finished, empty, and closable fast. That's the sweet spot for negotiation with builders. Now, that's not to say there's nothing to negotiate on a ground-up build because there is, and we do it consistently. But if I'm being completely straight with you about where our success rate is clearly higher, it's the spec homes. It isn't even close.

So if the thing you care most about is the deal, start by asking what they're sitting on, not what they can build you. And then there's the question of when you ask, which is where this gets really interesting. And that's exactly why we keep a list that I mentioned at the very beginning of this video. The new build VIP list is the answer to "what are you sitting on", the homes that have been standing the longest, the ones where the builders are carrying the cost and it's actually starting to create a pain or a bit of a hurt for the builder. And that's where the room is the biggest right now. It's 100% free. There's a link in the description you can click, and there are two or three questions on the form, price range, part of town, timeline, so that we can send you the 10 that best fit you instead of all 65. And fair warning, it changes weekly. A house sits nearly 90 days, goes under contract, and then it's off the list. That's why it's a list and not a video.

Best Time to Buy New Construction (3 Timing Levers)

There are three moments when a builder is more flexible than they are the rest of the time. All three are on the calendar. None of them are luck.

Lever 1 is the fiscal year end , and nobody talks about this one. D.R. Horton, for instance, closes their books September 13th. Lennar and KB Homes close November 13th. Ashton Woods, the company behind Starlight, closes May 31st. Most of the rest, including Pulte, Meritage, and LGI, they all run on the normal calendar year. Every one of those is public. It's on the cover of their filing. Anybody can read. And these dates don't drift. September 13th is their year end this year, next year, and 10 years from now.

A builder closing out their fiscal year while sitting on finished houses is the most motivated they will get all year. But I want to be careful here because the date alone doesn't do anything for you. A builder with nothing left to sell doesn't care what month it is. Year end plus standing inventory is the combination that we're looking for. Year end by itself is only half the story.

Lever 2 is closeout . Every community eventually runs out of lots. And when a builder gets down to the last handful of homes, something changes in how they start to think about it. They're not protecting a price list anymore. They're trying to finish up and move their people to the next community. We track which communities here are approaching closeout because it changes the entire conversation and our approach in negotiating for you as a buyer.

Lever 3 is the one I've never heard anybody else explain . I've talked on this channel before about the first wave of incentives at a brand new community is usually the weakest. Everyone's been waiting, they line up, and then the builder doesn't need to give you anything because they have a line out the front door. Here's the other side of that, and it's going to be the more useful side. When a builder releases a brand new phase of lots, every single person shopping in that community turns and looks at the new phase. All the attention, all the traffic, all the competition, it moves, which means the lots that were already there just got quiet for the first time in months.

Those older lots didn't get worse, they just got lonely. And a lot nobody is looking at is a lot we can negotiate on. That is the pattern underneath all three of these. Attention and leverage move in opposite directions. And on that deal I keep mentioning, two of these three were true at the same time.

The Throttle: How Hard to Push

But knowing when to push is only half the battle. The other half is knowing how hard. A while back I had two couples reach out in the same week from this channel, from watching these videos, both looking at the same community, both waiting on the same release of new lots in a new phase of an existing community, and the right strategy for them was completely opposite.

The first couple knew exactly the lot that they wanted, best one on the list. They wanted the view, the size, all of it. They told me over and over, we cannot lose this lot. Whatever it takes, we want to make sure we get it. So the priority for me and for our team was really, really clear. Priority 1, get the lot. Priority 2, get everything we can without risking number one. That's a very different job than negotiating hard. Walk in on release day and hammer on the price for the most desirable lot in the phase with other buyers standing right behind you. You don't get a discount. You get told no and somebody else gets the lot.

So you have to use negotiation like a throttle, not a hammer. You push where pushing costs you nothing. You ease off where it does. And you have to know the difference before you're standing there in the moment. There's no time to work it out. I was honest about what I didn't know when I was talking to them too. I couldn't tell them how much demand that release would pull, what the pricing would be, or what that lot specifically would go for in terms of price. What I could tell them is that we'd know when to push and when to pull back. That's our job.

The second couple, same community, same release, completely different buyer. They liked some of the new lots, but they weren't married to them. What they wanted was the best deal they could get. So I told them to do the opposite, because when that phase dropped, every buyer in that community was going to turn and stare at it, which meant the lots already sitting there were about to have fewer eyes on them than they'd had in months. That's when you make an offer on one of those.

Same market, same week, same builder, opposite place. And that's the part I want you to take away. Your strategy really isn't about the market. It's about which of those two people you are. If you want a specific thing, throttle. If you want the best deal, go where the attention just left.

Do You Need an Agent for New Construction?

Which raises a question I get asked a lot. Do I even need somebody for this? Let me tell you something about the builder's sales office that a lot of people genuinely don't know. The person sitting at the desk works exclusively for the builder, not for you. Now, that doesn't mean they're doing anything wrong. That doesn't mean that they're going to be unethical. That doesn't mean that you're going to be mistreated. Most of them are good at their job. They're good people. And I work with them consistently, and there's many of them I like.

But legally and practically, their job is to look after the builder's interest. That's who they represent, which means there's nobody in that room looking after yours unless you brought them with. And here's what I hear from those same builder sales agents, because I'm in their offices constantly. They tell me it happens all the time. An agent brings a buyer in, they're there for the first meeting, and then that buyer goes under contract and never hears from that agent again until closing. No check-ins, no help with questions, no guidance. Those buyers end up dealing directly with the builder alone as though they had never hired anybody at all.

And honestly, I'm as shocked to hear that information as the builder sales agent telling me this, as they're experiencing it over and over and over again. I'm not going to tell you what other people do. I'll tell you what the actual days are: the contract, the walkthrough before drywall goes up, the blue tape walk the week or so before closing, and then the closing itself. And one most buyers don't know, you can order your own home inspection on a brand new house. I did it on mine. 16 years in this business and I still hired a home inspector on a brand new house. And they find things, trust me. On a home the city inspectors and every other trade already walked through, they're gonna find stuff. That list becomes your punch list. We hand it to the superintendent and if there's 45 things on it, most of them the builder simply does without any pushback. If nobody tells you that's an option, you don't get it.

The $110,000 Deal: How All Three Timing Levers Lined Up

Everything I've showed you so far is public, the rates, the fiscal calendars, the price sheets. You could pull all of it up tonight if you wanted to. But here's what's underneath all of it. The advertised offer is the ceiling, not the price. Every builder here has room past what's on their website. How much depends on the builder, the community, what they're sitting on, and where they're at on that calendar. And the reason I can tell you that comes down to two things: information and reps.

When my business partner or I walk into a sales office, that management team already knows what we negotiated with them last week. They know that I know what they've already agreed to recently. That changes the conversation before it ever starts. But knowing is only the opening. You still have to run the conversation, decide what to ask for, in what order, how hard, when to stop. That part is a skill. And it's most of what people are actually hiring us for. An agent who hasn't done volume with that builder walks in cold, and the builder knows it.

So let me show you what happened when all of these things started to line up. A while back, I helped a good friend of mine buy a spec home. Three things were true all at the same time. Number one, the builder was closing their fiscal year within about 45 days. Two, it was a completed spec home sitting empty. And three, it had been sitting on the market for about four months. They were already advertising strong incentives before we walked in. But with these three stacked together, we could be far more aggressive on that than almost any other house in the city that week.

Between the reduction off their original asking price, the closing cost incentives, and the points that we were able to negotiate for the rate buydown, it came in at over $110,000 in savings, and she got a 30-year fixed mortgage at 4.75% with less than 20% down. That's the three pieces I added together: price, closing, and points. I'm giving you the math because a number like that deserves the math too. That's one of the best ones we've ever done. It's not the average one. I'd be doing you a disservice letting you think that that's normal.

Like I said earlier in the video, we are averaging a little over $44,000 for every buyer that works with us. This one happened to be $110,000 plus, which is amazing. Super stoked for her. Super stoked that she trusted us to help get her there. But it definitely is an anomaly, but it certainly is an example of what can be achieved when all of these things start to line up. And three, I want to be clear about this. None of this happened because she was my friend. Two things made that number possible: the builder's position, their fiscal year ending and closing, and a finished house that had been empty for months, that created the opening. And then somebody had to walk in and take it, knowing how hard to push on the house, knowing how hard to push on the builder like that. What to ask for first, and where the line was. That's the part we do for a living, and it's most of the reason why people hire us. The timing made it possible. The negotiation is what actually got it. You need both.

Which Strategy Is Right for You?

So here's what I'd actually do with all of this. One, ask what they're sitting on, not what they can build you. What's finished and empty right now, that's where the biggest amount of room is. Two, look at the gap between the rate and the APR on anything they show you. There might be a small gap. If it is, it's most likely real. If it's a big gap, ask what happens in year two, three, four, five. Three, ask when their fiscal year ends. That'll tell you a lot. It's public. If it's close and they're sitting on inventory, you're in a much better position than you were yesterday.

And here's what I actually believe about affordability in this city. The problem is real. Prices have moved, rates have moved, and a lot of people who could have bought here years ago are now doing the math and they're coming up short. I'm not going to pretend otherwise. But the answer isn't waiting for something to change. It's knowing that a builder has five levers where a seller, a normal resale seller, has one and knowing which week to ask. Timing has a huge, huge component of making this successful for you. And that's not a trick. It's just a calendar, a couple of public filings, and somebody in the room with you who has done this a few hundred times.

And I'll tell you why this one matters to me more than most. I bought a new build myself. Same sales office, same blue tape walk, same superintendent. What struck me going through it as a buyer instead of an agent is how much you're simply expected to already know. Nobody hands you a calendar. Nobody mentions the house at the end of the street that's been empty for four months. Nobody tells you that you can get your own inspection. None of that is hidden. It just, it's not really their job to tell you.

Conclusion

So here's where I'll leave you. Everything I showed you today is real and it's yours to use. The calendar, the APR test, the question about what they're actually sitting on. Take all of it. But understand the room you're walking into. There is one professional in that sales office and they work for the builder. That's not a knock on them at all. It's just the structure. They're good at their job and their job is the builder's outcome.

The question is whether anybody's in that room that knows how to negotiate and get what you are looking for. Somebody who knows what the management team agreed to last week, who knows which week to push and which week to wait, who's standing in the house in the framing walkthrough and the blue tape walk and on the phone when something goes sideways in month four. That's the job. It's what we do. And it's what we're good at.

If you're buying in the Tucson area in the next 90 days, here's exactly what working with us would look like. One, between negotiating the price down from the original asking price and getting seller credits, we're averaging about $44,000 in savings for every single buyer who hires us. And two, we have a 100% track record of getting our compensation paid for by the builder or the seller you decide to purchase from. Never once has a buyer had to pay our compensation out of pocket. Call/text me at 520-639-9117 or book a FREE consultation here.