New construction real estate transactions can flow very differently than a traditional sale between a buyer and seller. One aspect of the transaction from the time a decision to build/buy has been made and the closing table where the keys are handed over is the concept of the critical path. While this pathway does exist in traditional transactions, it is more prevalent and volatile in new construction.
The critical pathway is the list of tasks that must happen in a certain order in order to get from the decision to buy to closing. It is a pathway that is dependent on each task being completed in the correct order at the correct time. A happens first, then B, then C. D cannot happen until C is completed and so on. There may be task list items #1, 2, and 3, but they are not interdependent of each other, nor are they on a specific timeline that affects the transaction as a whole from moving forward.
An example of a critical pathway and a lynch pin item in new construction is that of cabinetry. A lynch pin item effectively backlogs the funnel of the critical path. All items before lead up to that moment, with nothing happening afterwards until it is completed. Cabinets are a lynch pin. There are many components to completing a home that must come after the cabinetry has not only been selected, ordered, delivered, but also installed. Countertops, backsplash and finish plumbing are on hold until the installation is complete.
To avoid a backlog in the funnel or detours of the critical path, it is crucial for buyers of new construction homes and condos to understand the timeline, respect the order of which items must be completed and be diligent about making selections in a timely manner. There is also a need for grace as unpredictable events with a lynch pin item that puts the critical path behind – like a major midwest blizzard that shuts down cities where cabinets are manufactured and then put on trucks that cannot travel in such conditions and therefore are weeks behind. Mother nature does not always cooperate with the critical pathway, so grace is an important element.
The critical pathway can be daunting to navigate, hard to understand, or needing regular communication. A licensed real estate agent or team can help you find your way as smoothly as possible from decision making to closing.