A property built by a developer or builder without a specific buyer in mind is constructed on speculation, anticipating a future sale. The structure is designed and built based on market trends and generalized buyer preferences, rather than tailored to individual specifications. For instance, a builder may construct a house with a common floor plan, standard finishes, and popular amenities in a desirable neighborhood, hoping to attract a buyer seeking a move-in-ready home.
The practice offers advantages by providing readily available housing inventory and streamlining the purchasing process for buyers who may not have the time or desire to engage in a custom build. Historically, this type of construction has been driven by periods of economic growth and increasing housing demand, allowing developers to capitalize on market opportunities and offer quicker solutions for potential homeowners. This can benefit both the builder, who achieves economies of scale through standardized construction, and the buyer, who can avoid the lengthy design and building timelines associated with custom projects.