Your Guide to New-Home Construction

The Austin metro area is booming. From South Austin to Leander, builders are busy creating neighborhoods for the region’s growing population. At the same time, higher interest rates and growing inventory have prompted price reductions across many communities. In July 2025, more than half of the active new‑construction listings in the Austin MLS showed a price drop, and builders in cities like Georgetown, Kyle and Leander were reducing prices by 10–15% to stimulate demand. That means buyers have options—but it still pays to be prepared. This blog distills industry best practices and local market insight to help you navigate the new‑construction process with confidence (and a bit of fun) in the Austin metro.

Understand the Money

Before you tour model homes in Pflugerville or Round Rock, get a handle on the financial basics.  Base price vs. contract price: the base sales price is the cost of the home before any upgrades. When you add hardwood floors, designer cabinets or a bigger patio, you are paying the contract sales price—base price plus upgrades. As a simple example, a $300 000 base price plus $25 000 in upgrades equals a $325 000 sales price.

You will likely need a mortgage unless you are paying cash. Some buyers choose to lock in their interest rate early by paying a fee for a rate lock. With a construction‑perm loan, one application covers both the construction loan and the permanent mortgage—handy when you’re building in areas like Georgetown where timelines may vary. Builders often partner with preferred lenders; using one can unlock incentives, but it’s still smart to shop around. Don’t forget to budget for a home inspector’s fee and other closing costs.

Key terms at a glance

Base priceStarting price before upgrades

Contract priceBase price plus any upgrades

Rate lockFee paid to freeze your mortgage rate during construction

Construction‑perm loanOne application for both the construction loan and the permanent mortgage

Preferred lenderLender chosen by the builder to finance homes

IncentivesPerks like decorating allowances or closing‑cost contributions

What’s Negotiable (and What Isn’t)

In Austin’s hot market, it’s tempting to try to negotiate the base price of a new home. However, a buyer’s agent’s main job is to find the right home with the right builder at the right price, not to slash the sticker price. Even if the market softens—like the recent price reductions across Leander, Kyle, Manor and Georgetown—builders embed sales commissions into the price, so shopping without a Realtor won’t score you a discount. Indeed, about seven out of ten new homes nationwide are sold through Realtors.

What you can negotiate are incentives. Builders use perks to motivate buyers to commit to a specific lot or home. Examples include:

• Decorating allowances for upgrades like cabinets, carpet or lighting.
• Cash contributions to closing costs when you use the builder’s preferred lender.
• Waived lot premiums or price‑increase deadlines.

A builder will usually increase a decorating allowance before giving extra cash toward closing, because providing an upgrade may cost them less than the dollar value it represents. If you need more cash for closing, your Realtor can sometimes negotiate by offering the builder something they value—perhaps agreeing to close early—in exchange for a higher credit.

Meet Your On‑Site Sales Consultant

Whether you’re exploring master‑planned communities in Liberty Hill or touring model homes in Easton Park, you’ll interact with the builder’s on‑site sales consultant. These full‑time professionals handle almost every aspect of the sale. They:

• Explain features, construction quality and design.
• Sell the value, location, amenities and builder reputation.
• Create a sense of urgency by highlighting incentives and limited inventory.
• Coordinate financing and mortgage approvals.
• Answer construction questions and manage contracts.

Remember, the on‑site agent represents the builder. Having your own Realtor ensures there’s someone advocating for your interests and budget.

Why Work With a Realtor in Austin

With multiple builders adjusting prices and incentives across the metro, local knowledge is invaluable. According to the National Association of Realtors, nine out of ten homebuyers use an agent, and limited inventory means properties can move quickly.

Your Austin‑area Realtor:

• Tracks which communities are offering price reductions or special incentives.
• Understands local factors such as property taxes, school districts and commute times.
• Negotiates incentives and coordinates inspections, financing and contracts.
• Doesn’t cost you extra—the builder usually pays the bill per their marketing budget.

Preparing to Interview a Realtor

To get the most out of your agent relationship, prepare before reaching out. This process works just as well for new‑construction communities in the Austin suburbs as it does anywhere else:

1. Clarify your wish list. Decide on home size, style and preferred areas. Check out the New-Home Construction
2. Contact a local Realtor I am here at your service, provided I we are a good fit for one another.
3. Ask about financing. Request lender recommendations and learn how mortgages work for inventory homes versus pre‑construction.
4. Discuss your current home. If you have a property to sell, ask how the agent would handle the timing and marketing.
5. Evaluate experience wisely. Construction experience isn’t a must; what matters is knowledge of the local market and builder landscape.

A good agent will listen to your goals, communicate clearly and advise you without pressure.

Final Thoughts: Take It Slow and Enjoy the Ride

Building a new home in the Austin area isn’t a sprint. You might start off wanting a four‑bedroom home in central Austin and discover that a three‑bedroom in Leander better fits your budget and commute. Stay flexible, ask questions and keep your agent informed. With market conditions shifting—builders cutting prices in response to higher inventory — the key is to move forward thoughtfully.

Understanding the money, knowing what can be negotiated and partnering with a knowledgeable local agent will help you make a smart, stress‑free decision.