Buying new construction in Chicago can be incredibly exciting. There is something special about being the first person to live in a home and enjoy a space that feels fresh, modern, and move-in ready.
But new construction also comes with its own process, timeline, and expectations. Even when everything is moving in the right direction, there are a few important things buyers should know before closing. Buying new construction should come with the 3 P’s: a basic understanding of the construction process, permits and patience.
The Home May Not Be 100% Finished When You First See It
With new construction, buyers are often viewing the home before it is completely finished. You may notice missing walls, hardware, paint touch-ups, unfinished trim, appliance installation still in progress, exterior work not yet complete, or small items that still need correction.
This does not always mean something is wrong. It usually means the home is in the beginning, mid or final stage of completion.
This is where the punch list comes in.
A punch list is a list of items that still need to be finished, repaired, adjusted, or touched up. Common punch list items may include paint touch-ups, cabinet adjustments, door alignment, missing trim, scratched surfaces, appliance issues, landscaping, or unfinished exterior details. This punch list is typically created right before closing, and the builder will have a specific timeline for its completion. In addition to this, the buyer’s attorney will request an escrow to be held back to ensure that the builder completes this punch list in the timeline agreed upon.
Expect Possible Delays
New construction timelines can shift. Even experienced developers can run into delays with materials, labor, utility connections, final inspections, permits, or city approvals.
In Chicago, permit timing can be one of the biggest factors. Sometimes a home may look almost complete, but final approvals are still pending. Buyers should be prepared for the possibility that the closing date may move, especially if the property is waiting on final permits, inspections, or the certificate of occupancy.
The best thing buyers can do is stay flexible and ensure their agent, lender, and attorney communicate closely with the developer’s team.
Your Inspection Usually Happens Close to Completion
Even though the home is brand new, an inspection is still important. New does not always mean perfect.
For new construction, the buyer’s inspection usually occurs when the home is nearing completion. The goal is to inspect the property once most major systems, finishes, and appliances are installed, but still leave enough time for the developer to address any concerns before closing.
An inspector can look at the major systems, plumbing, electrical, HVAC, appliances, windows, drainage, roof areas, and overall workmanship. The inspection may also help identify items that should be added to the punch list. We always recommend that our buyers conduct a radon test and a sewer scope for Single-family homes.
The Lender Appraisal Usually Happens Once the Home Is Nearly Complete
If you are financing the purchase, the lender will typically need the property to be close to completion before the appraisal can be finalized. The appraiser needs to see enough of the finished home to support the value. All appliances, mechanical components, and most home components need to be in place for this appraisal to proceed.
If the home is not far enough along, this can sometimes delay loan approval or closing. This is another reason why timing and communication are so important during a new construction purchase. It is crucial that, if a buyer is obtaining a loan, the lender extends the rate lock for as long as possible to account for potential delays.
Understand What Is Included
Every new construction home is different, so buyers should be clear on what is included in the purchase price.
Ask about appliances, lighting, closet systems, window treatments, parking, storage, landscaping, decks, roof rights, and any upgrades or finish selections. If the developer agrees to add or change something, make sure it is documented in writing.
It is also important to understand what may not be included. Sometimes items that appear in renderings, marketing materials, or model homes are upgrades or staging pieces rather than standard inclusions.
Punch List Items May Be Completed After Closing
Ideally, punch list items are completed before closing, but that is not always the case. Sometimes a few items remain because a part is backordered, exterior work is weather-dependent, a trade needs to return, or the developer is waiting on a final item to be completed.
When this happens, the attorneys may negotiate for funds to be held in escrow at closing. This means a portion of the seller or developer’s proceeds is held back until the agreed-upon work is completed.
Once the punch list items are finished and confirmed, the escrow funds are released. This gives buyers added protection and helps make sure the remaining work is completed after closing. The exact amount, timing, and release terms should be clearly documented by the attorneys before closing.
Ask About the Builder Warranty
Many developers include a one-year builder’s warranty with new-construction homes. This can be a helpful safeguard for buyers after closing, especially as they begin living in the home and using the systems, appliances, and finishes.
Warranty coverage can vary, so buyers should review the details carefully with their attorney. It is important to understand what is covered, what is excluded, how warranty requests should be submitted, and how quickly the developer is expected to respond. Also, some rehabs will not include a warranty. This is something that should be negotiated upon writing a contract and making an offer on the property.
Do a Final Walkthrough Before Closing
Before closing, buyers will do a final walkthrough to confirm that the home is in the expected condition and that agreed-upon items have either been completed or properly documented.
The final walkthrough is also a chance to confirm appliances are installed and working, finishes are in place, and any remaining punch list items are clearly understood by all parties.
If certain items are still outstanding, your attorney can help make sure there is a plan in place, including whether escrow funds should be held until the work is complete.
New Construction Can Be Worth the Wait
New construction can involve moving parts, but it also offers incredible benefits: modern layouts, updated systems, new appliances, energy efficiency, current finishes, and the peace of mind that comes with being the first owner. We have often found that the value exceeds the contract price when the home is finished, as new construction has proven a good investment for our clients.
The key is knowing what to expect. With the right team, clear communication, and a little patience, buyers can feel confident throughout the process and enjoy all the benefits of a brand-new home in Chicago.
