Understanding Special Assessments in Wichita: What New Home Buyers Need to Know

When buying a home in Wichita, Kansas, one term you’re likely to encounter is “special assessments.” Locally, these are sometimes referred to simply as “specials,” which can add to the confusion for new home buyers unfamiliar with the term. While it might sound like a promotional offer on a new home, special assessments are simply a unique way to manage infrastructure costs in Wichita’s housing market. This blog will explain what special assessments are, why they exist, and how they affect the cost of your new home and mortgage.

What Are Special Assessments?

Special assessments are fees associated with new homes to cover infrastructure costs. When developers build new neighborhoods in Wichita, they often pass on the expense of creating essential systems—like water, sewer, and roads—directly to homeowners rather than including these costs in the price of the home.

These fees fund:

• Roads and sidewalks: Ensuring convenient access to your home.
• Water and sewer lines: Connecting each home to clean water and sanitary systems.
• Electric utilities: Bringing power to every property.
• Drainage systems: Preventing flooding with proper rainwater management.
• Parks and amenities: In some developments, neighborhood green spaces and community features.

Unlike other markets where these costs might be bundled into the home price, Wichita separates them into special assessments, which homeowners pay over a 20-year period. This allows for lower upfront costs when buying a home but results in higher monthly payments.

Why Are There Special Assessments in Wichita?

In many cities, developers include the cost of infrastructure in the purchase price of a new home. For example, in Denver or Houston, the total cost of creating the neighborhood’s roads, utilities, and drainage systems is baked into the final sale price. However, Wichita handles this differently.

Here, homebuyers pay for infrastructure separately through special assessments. This approach helps developers manage costs upfront while allowing buyers to spread these costs over time. The result is that Wichita homes often appear more affordable at first glance, but buyers should account for these assessments when planning their budget.

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How Do Special Assessments Work in New Construction?

When building a new home in Wichita, the cost of special assessments is divided among all the lots in the development. Homebuyers then pay their portion over time, usually as part of their annual property tax bill.

These payments typically last for 20 years and are collected through your escrow account alongside your mortgage payment. The total cost depends on:

• Lot size: Larger lots may have higher assessments.
• Infrastructure complexity: Developments with more features or amenities can have higher costs.
• Neighborhood design: Special assessments vary between neighborhoods, so the home’s location matters.

Benefits of Special Assessments for Buyers

For those building or buying a home in Wichita, special assessments have some surprising advantages:

1. Lower Upfront Costs

Because the price of the home doesn’t include infrastructure costs, the initial price tag of new construction can be more affordable. This makes owning a new home accessible to a wider range of buyers.

2. Manageable Payments

Instead of paying for all infrastructure costs upfront, homeowners spread the payments over 20 years. This can help manage cash flow while enjoying the benefits of a fully functional neighborhood.

3. Attractive Housing Options

By reducing the financial burden on developers, Wichita’s system encourages the creation of more neighborhoods and homes. Buyers have access to a variety of new construction options tailored to different budgets and lifestyles.

Challenges of Special Assessments

While there are advantages, special assessments do add complexity to the home-buying process. Here’s what to watch out for:

1. Higher Monthly Payments

Special assessments are paid in addition to your mortgage, property taxes, and insurance. This can make your monthly payments higher than expected when buying a home in Wichita.

2. Long-Term Commitment

Special assessments typically last for two decades. While these costs eventually disappear, buyers should be prepared for a long-term financial obligation.

3. Limited Transparency

If you’re unfamiliar with how special assessments work, the extra cost can feel like a surprise. Buyers moving from other markets should ensure they understand these fees fully before signing any contracts with a home builder.

How Special Assessments Affect Your Mortgage

Special assessments aren’t included in the mortgage principal for your new home; instead, they are bundled with your property tax payments. For example, if your annual assessment is $2,400, you’ll pay an extra $200 per month.

For buyers building a home with a Wichita home builder, this payment structure allows you to focus on customizing your home without needing to pay for infrastructure costs upfront. However, you’ll need to budget for these payments as part of your overall housing expenses.

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Tips for Navigating Special Assessments When Buying a New Home

If you’re considering new construction in Wichita, here are a few tips to help you manage special assessments effectively:

1. Ask Questions Early

When working with a home builder or touring new developments, ask for a detailed breakdown of special assessments. Find out the total amount, repayment terms, and how these costs will affect your monthly payments.

2. Work with a Local Expert

A knowledgeable Wichita realtor can help you understand special assessments and guide you to neighborhoods with fees that fit your budget.

3. Plan Your Finances Carefully

Be sure to include special assessments in your financial planning. Calculate your estimated monthly payments to ensure you can comfortably afford your new home over the long term.

4. Consider Neighborhood Value

Remember, special assessments fund the infrastructure and amenities that make a neighborhood livable. Roads, utilities, and green spaces all contribute to the value of your home and quality of life.

Special Assessments and the Wichita Advantage

Wichita’s approach to special assessments reflects the city’s commitment to offering a wide range of housing options. While these fees represent an additional cost, they enable developers to create high-quality neighborhoods while keeping new home prices competitive. By understanding how these costs work and planning accordingly, you can confidently explore new construction options in Wichita.

Whether you’re working with a home builder or buying a move-in-ready home, knowing the ins and outs of special assessments will ensure a smoother, more informed home-buying experience.

The Bottom Line

Special assessments are a critical part of buying a home in Wichita, particularly in new construction. While they add complexity to the process, they also provide flexibility and affordability for buyers. By understanding these costs and planning your budget accordingly, you’ll be well-prepared to build or purchase the perfect new home in Wichita.

If you’re ready to explore options or have questions about special assessments, reach out to local experts who can help you navigate this unique aspect of Wichita’s housing market.