Purchasing a new construction home in Florida is an exciting and well-coordinated process that brings buyers and builders together around a shared goal. One of the first steps in that journey is earnest money, a good-faith deposit that allows the builder to reserve your homesite, align construction schedules, and begin detailed planning.
Because new construction follows a longer and more structured timeline than resale homes, earnest money is designed to support permitting, design selections, material ordering, and construction coordination. Understanding how earnest money works in Florida new construction contracts helps buyers move forward with clarity, confidence, and shared expectations.
Below are five essential tips to help navigate the process smoothly.
Understanding Earnest Money
What Is Earnest Money?
Earnest money is a deposit paid when a purchase agreement is signed. According to the National Association of Realtors, earnest money shows the seller or builder that the buyer intends to move forward with the transaction.
The contract permits the builder to deposit the funds into operating accounts to offset initial fees such as permitting and other early costs on the project. The intention is to offset the total financial burden to the builder thus keeping costs down for all involved.
For new construction homes, builders may also require additional deposits at specific milestones outlined in the contract.This may occur if a buyer selects upgrades beyond the builder recommended budget.
Importance of Earnest Money in Florida
Florida is one of the fastest-growing housing markets in the United States.U.S. Census Bureau data shows Florida gained more new residents than any other state in recent years, increasing demand for new construction homes. As a result, builders often use earnest money deposits to manage risk and prioritize serious buyers.
This means buyers must be especially careful about contract terms that define when deposits become nonrefundable.
Tip 1: Know the Florida Housing Market Analysis
Current Market Trends
Florida’s housing market continues to show strong demand for new construction, particularly across Central Florida and key coastal communities. Data indicates that ongoing population growth and limited housing inventory have kept new home demand resilient, even as interest rates have fluctuated.
For homebuyers working with CFB Homes, understanding these market dynamics helps set clear expectations around earnest money and construction timelines. In a competitive environment, early financial preparation can make the buying process smoother and more predictable.
CFB Homes encourages buyers to connect early with our trusted lending partner, Atlantic Bay Mortgage, to review financing options, timelines, and approval requirements. Having a strong pre-approval in place not only supports the overall homebuilding process but also helps buyers move forward with confidence in today’s market.
Impact on Earnest Money Amounts
In resale transactions, earnest money in Florida often ranges from 1 percent to 3 percent of the purchase price. New construction homes may require different structures to reflect the planning and coordination involved in building from the ground up.
At CFB Homes, our earnest money structure is 3.5% at the time of contract (more for non owner-occupied investment properties). Please check with your sales associate for details specific to your community of interest.
This approach supports efficient construction planning while providing buyers with clear visibility into deposit timing.
Tip 2: Research Florida New Home Builders
Choosing the right builder is an important part of the homebuilding experience. While earnest money structures can vary across Florida new home builders, reputable builders clearly communicate how deposits are handled and how they support the construction process.
Buyers should confirm builder licensing, review credentials, and ask questions about timelines, communication, and expectations to ensure alignment from the start.
Understanding Builder Earnest Money Policies
New construction contracts are tailored to reflect construction timelines rather than resale transactions. Earnest money terms may specify when deposits are applied as the project progresses, particularly after design selections or permitting milestones.
Reviewing these terms before signing ensures buyers understand how deposits support construction planning and how expectations are managed throughout the build.
Tip 3: Be Clear on the Florida Home Buying Process
Steps Involved in the Purchase
The Florida home buying process for new construction typically includes contract execution, financing approval, design selections, construction milestones, inspections, and closing. Earnest money timing is often coordinated with these stages to keep the build process organized and predictable.
Understanding how each phase fits into the overall timeline helps buyers stay informed and engaged throughout the experience.
Key Deadlines for Earnest Money
Contracts clearly outline when deposits are due, who holds them, and how notices must be delivered. Buyers should track these dates carefully and retain written confirmation of payments and communications.
Clear documentation and timely communication support a smooth transaction for all parties involved.
Tip 4: Review the Florida Home Inspection Process
Importance of Inspections Before Finalizing Deals
Independent inspections are a valuable part of the new construction process. Industry guidance from the National Association of Home Builders and the American Society of Home Inspectors indicates that inspections of newly constructed homes often identify items related to grading, roofing, plumbing, electrical systems, and framing that benefit from early review during the construction process.
Addressing these items during construction helps support quality outcomes and long-term home performance.
Tip 5: Protecting Your Earnest Money
Contingencies That Safeguard Your Deposit
Florida new construction contracts commonly include contingencies related to financing approval, appraisal, inspection, title review, and HOA or condominium document review when applicable. Some builders also include provisions related to lot approval or construction feasibility. They will vary both by builder and community.
These contingencies help ensure an organized and well-documented transaction.
When and How to Request Refunds
If a cancellation occurs within the terms outlined in the contract, buyers typically provide written notice to both the builder and the escrow holder along with any required documentation. Escrow funds are released according to contractual procedures to ensure transparency and compliance. Many times there will be an administrative fee or penalty for cancellation. It is important to read and understand your contract to know whether a refund is applicable to the specific conditions.
Final Thoughts
Earnest money for new construction homes in Florida reflects the planning, coordination, and commitment involved in building a home from the ground up. Market conditions, construction timelines, and contract milestones all work together to guide how deposits are structured.
By understanding the process, asking informed questions, and staying engaged throughout each stage, buyers can move forward with confidence and clarity. Managing earnest money thoughtfully supports a smooth homebuilding experience and a successful path to closing on a new construction home in Florida.
If you’re considering a new home with CFB Homes, our team is here to guide you every step of the way. We also encourage buyers to connect early with our trusted lending partner, Atlantic Bay Mortgage, to review financing options, timelines, and approval requirements. Early coordination between your builder and lender helps ensure expectations stay aligned and supports a seamless homebuilding experience from contract to closing.
