Presale Homes Explained: The Pros, Cons, and Steps to Buying a Home Before It’s Built

New home construction is thriving across the country: according to Zonda data from July 2025, there were an estimated 668,318 new homes sold on a seasonally adjusted annualized basis with the average sale price of $403,800.

Presales make up a significant chunk of these new home sales and remain a popular entry point into the housing market, thanks to their unique advantages. Presales refer to homes purchased before they are completed, often before construction has even begun. Builders typically release lots and floor plans early to gauge demand and secure financing.

For homebuyers, presales mean getting in on the ground floor – literally. You may be putting down an initial deposit on a presale home years before it’ll be finished. But it also means you are involved with every step of the home building journey, picking out customizations and plots before a single nail is hammered in.

Here’s a closer look at what presales are, their benefits and drawbacks, and how to navigate a presale home purchase with confidence.

Benefits of Presales

There’s a reason why homebuyers opt for the presale route. Advantages include:

• Locking in Pricing: In many markets, home prices tend to rise as construction progresses. When you purchase early, you secure today’s price point. You could save thousands of dollars by opting into a presale home.

• Building Equity Before Move-In: Your initial investment appreciates, too. If the housing market climbs while your home is being built, you’re essentially gaining equity before you even unpack your boxes.

• More Time to Save: Presales often come with longer timelines between contract and closing, giving buyers extra months to save for closing costs, furniture, or other expenses. You won’t have to hand over a gargantuan down payment, either. Often presale homes come with a deposit structure, so you’d make an initial deposit with your offer, followed by subsequent payments as the construction progresses. This makes your budget a lot easier to manage during the homebuying process. You also won’t be rushing against the clock to get preapproved and qualified for a mortgage. The paperwork should be sorted out well before closing.

• Flexibility for Moving In: Paired with the financial wiggle room is flexibility in time. Whether you already own a home or you’re renting, buying a presale gives you time to sell or give notice so you can prepare for the next chapter.

• Customization Opportunities: Presale buyers typically get access to the broadest range of choices to customize their home – whether it’s selecting their preferred lot, personalizing finishes, or opting for floor plan modifications, you’ll have a library of options from your builder. This is often the biggest perk that draws homebuyers to a presale home. You’ll have access to design centers, brochures, and open houses to help you get inspiration.

• First Pick of Lots: Being among the first in means you get the widest selection of available lots and floor plans. Make sure to ask about your builder’s final plans for the community they’re developing – you may want to be on a quieter cul de sac or situated far from where model homes will be set up.

Potential Drawbacks of Presales

On the other hand, there are some disadvantages for presale homes, especially if you’re time-strapped or wary of buying a home based on brochures and blueprints. Drawbacks include:

• Longer Wait Times: For some, a long time to prepare is a good thing. For others who need a home that’s turnkey ready, a presale home isn’t an option. Depending on the build schedule, move-in dates may be at least a year or more away. Construction delays, which are common in today’s market with supply chain and labor disruptions, can push timelines even further.

• Market Shifts: If the market softens during construction, you may close on a home that’s worth less than your contract price. This isn’t likely when it comes to new construction homes, but it’s a worry that may trigger doubt in some buyers, who want to score the best deal on their home.

• Uncertainty in Final Product: Some homebuyers need to see the home they’re purchasing in the flesh (or should we say, in the siding?). It takes a clear vision to buy and customize a presale home based on floor plans and renderings. Sometimes the finished product may not fully match your expectations.

• Design Fatigue: If home design and aesthetics aren’t your thing, buying a presale home and choosing customizations may get overwhelming. You can go with the baseline model each time, but the decision-making process may be time-consuming if you aren’t interested in it.

• Financing Challenges: Some buyers may face hurdles if interest rates rise before closing. A higher rate at move-in could affect monthly affordability. Homebuyers locking into a presale home should include some buffer in their housing budget in case interest rates have crept up by the time the home is move-in ready.

Navigating the Presales Process

If you’re curious about taking the presales route, take these steps to help you along the process:

1. Do Your Research. Presale homebuilders often promote their upcoming developments in a few different locations on their website. Zero in on locations you’re interested in, scroll through builders’ development plans, and make sure you do your homework on builder reputation, past projects and homeowner feedback.

2. Identify a Home. Set aside weekends to visit design centers, open houses, and model homes to get a feel for what you like – and don’t like – within the presales selection. Getting to see showrooms and mockups of your potential new home will make a big difference in helping you decide on what to buy.

3. Clarify the Contract. Shop around for homes and compare price points before making your pick. Once you decide, understand your builder’s deposit requirements, upgrade costs, and policies around changes. Once you agree on price and terms, you’ll make a deposit of “earnest money” into escrow to secure your lot. Don’t forget to ask:

   • How firm is the build timeline, and what could delay it?

   • What do I get to customize and what is the process for customizing features?

   • How are construction delays communicated to buyers?

   • What is the schedule for making deposits and down payments up until closing?

   • What happens if interest rates change before closing?

   • What warranties are included with the home?

4. Meet the Design Team. Now for the fun part: after all the paperwork is done, you’ll connect with your builder’s interior design team to select the palette of paint colors, carpets, hardwood, and other textiles that will make up every room in your home.

5. Plan for Flexibility. As with any new home sale, your safest bet is to build in a buffer for closing timelines and potential delays. Factor this in whether you’re selling your current home, ending a rental lease, or living with your in-laws before closing day.

6. Stay Updated on the Market. Keep an eye on mortgage rates and local housing trends during the build. As you get closer to closing, you’ll need to finalize your mortgage interest rate, and make sure you have enough savings to transfer over your lump sum down payment.