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New Build Homes in Airdrie, AB

Is buying a new build home with the current state of the market a good idea? There are a lot of factors that go into answering that question, I'm going to talk about a few of the things the builders won't tell you!


interest rates

When purchasing a home, you'll typically go to a mortgage broker or a bank to lock in a rate for 3-4 months. This gives you a good amount of time to find a home, move in, and get your mortgage within that timespan.

Some lenders offer new build rate locks, which secures a slightly higher rate for up to 12 months. The problem we're seeing right now, is that new builds in the city are taking over 12 months to complete. So, from the time you sign the papers and firm up your purchase, you don't know what your interest rate will be on your final sale when you move in.

Since they can only lock in for 12 months, you might have lock in your rate 3-6 months into your build when interest rates have gone up quite a bit already.

The graph below shows just how much interest rates have gone up in the last year alone, from 1.5% now up close to 4% for a fixed mortgage, which is a huge change.

If you started your build today and it was complete in about a year from now and we saw the same increases, you could be looking at an interest rate well over 5%. For example, on a $600,000 home with 20% down, that would increase your monthly payment by $400 or more. So, it definitely has a big impact on how much you're paying out of pocket per month and how much is going towards interest vs principal.

Variable rates haven't been much better, we've seen them rise from about 1% to 2% which is still a quite a dramatic jump and it would be pretty unknown what you're interest rate would end up being.

Escalation clauses

When you're buying from a builder, that builder is a business and wants to make as much profit as possible. When prices have been going up as rapidly as they have been here, the builder wants to capitalize on the market and one of the ways they do that is through escalation clauses.

These clauses in the builder's contract, essentially give the builder the right to increase the price you're paying for the home you've already firmed up on, at any point during the building process. If a builder chooses to act on the clause, your options as a buyer are to either agree to pay the new price or walk away from the home completely.

The reaction I get from a lot of buyers when they find out about this, is asking if this is even legal. Unfortunately if the builder has it written into the contract as a term, they are able to act on it when they want to.

Some builders are more upfront about escalation clauses and you can decide to sign the contract or not, but others might have it more hidden.

I have an example from a family in Airdrie, who bought their new build back in fall of 2021 and they've been working through the build process. Just in April, they got a call from the builder saying they require an additional $50,000 for the home and now they're in a position of deciding whether to accept or search for something else.

Most people hear that and assume it's an easy choice... walk away, but it's really not as simple as that as the house they bought in fall has now gone up in value $80,000-$100,000. Do you give up that $50,000 in equity and hold onto the $30,000-$40,000 in equity you've accumulated or do you start over and buy at today's market price.

As a buyer, there are a few things you can do to protect yourself from escalation clauses:

  • Flat out ask the builder about their policy and see what their response is - this may be a good gauge of how they will be during your transaction and dealing with any escalation clauses if they come up

  • Have a local Realtor represent you in the purchase, it doesn't cost you anything extra and it's better to have someone who has knowledge about new builds, builders, and has your best interest in mind throughout the sale

  • Get your lawyer to look though the contract - sometimes it might be tricky wording or state that the builder has the right to cancel the contract at any time and present you with a new one at a higher price. You could also potentially add in a term saying that the price cannot be increased after you've firmed up on the sale, but keep in mind the builder can refuse any term you add

If you are a buyer looking to get your home search underway, I'd love to help! Click the button below to go fill out my buyer consultation request form!


Due to supply chain issues and labour shortages in certain trades, your looking at a 12-16 month build time on average. Most builders will say 10-12 months, but construction almost always get delayed at some point.

If you're flexible about your move in date it's not gonna be a huge deal if it's not ready on schedule, but if you're trying to line up the sale of your current home it can get a bit tough.

As long as you're prepared for the build to be delayed and you don't have a bunch of stuff relying on the completion time, it shouldn't be too bad.

One consideration though, is that the longer your build takes, the more time it gives for the market to increase and the more likely it is that you'll run into an escalation clause.


Builders only release a few lots at a time and have waitlists for people who are waiting for a property to come up for sale. The reason they do this is because they don't want to sell everything right away and not be able to start construction, but they also don't want to miss out on price increases in the market. So, they might sell a couple right now then raise the prices next month and sell more. It's important to know that when you do get a call from the builder about having a lot ready, the price has very likely gone up since you last spoke.

One other thing to mention, is that they're

not required to put buyers in the order that they came. For example, if a sales manager speaks to someone who is has a large downpayment or is paying with cash, they could bump them up and get them into a home sooner. From business standpoint, they want to deal with people who are going to be easy throughout the transaction, so they can have a smooth sale.

So, if you're on a waitlist you may not just be going up and up on the list, you'll get the call when the builder feels you are the next best option to buy a house in the area.

If you want to find out how much your home is worth in today's market, click the button below to go fill out my home evaluation request form!


Check out my YouTube video below where I go over everything in this blog post and subscribe to my channel if you want to see more Airdrie related content!

- Brad Walker


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