As a new build specialist, I often find people don’t realize what a valuable asset using a realtor in the new build process is and the fact that it is totally FREE to you…the buyer! As with any real estate transaction, each side of the party has their own motivations for the outcome of the transaction. The salesperson is working for the builder and has the builder’s best interests along with their personal commission top of mind. As a buyer, it is beneficial to have a real estate agent on your side working for YOUR needs and desires, negotiating on your behalf to save you money, and helping you through last minute changes or surprises that arise.
Before you start working directly with a home builder, consider the following reasons a buyer’s agent can work to your advantage in the home building process.
1. A Buyer’s Agent Works for YOU and their service is FREE!
There’s no money out of your pocket to use the expertise of a real estate agent in the home building process. The builder pays the buyer’s agent a commission. The buyer’s agent represents you in the transaction for FREE. You will pay the same purchase price for the home regardless of whether you work with a buyer’s agent. Partnering with a realtor just makes sense and offers you several FREE benefits.
2. Invaluable Knowledge and Expertise
Building a home and moving to a new community is a big decision. You’ve probably done some research of your own; however, tapping into the knowledge of an experienced agent can provide valuable information about the local real estate market and community you may not be able to get on your own. Realtors study neighborhoods and market trends daily. They also have first-hand experience working with builders as well as other clients buying in the same community which can provide valuable insights. An agent can help you understand all your options prior to making a final decision. He or she will listen to your needs and help you find the community that matches your desires and lifestyle.
3. Negotiation on Your Behalf to Help Save you Money
Great real estate agents are professional negotiators. Depending on the inventory available from the builder and current real estate market conditions, a buyer’s agent can help negotiate the purchase price for you, gain incentives or allowances for you to put towards upgrades, or help secure closing cost credits. A realtor will also provide you with a Comparable Home Value Analysis for homes in the area with similar specs to the one you’re considering which will help ensure you don’t unknowingly overpay on the final purchase price. Even in a seller’s market where the demand for new homes is high, I’ve been able to negotiate incentives up to $15K for my clients. Every situation and home builder is different. Sometimes it takes multiple tries before coming to an agreement and other times the builder repeatedly says no. It never hurts to try negotiating and helps to use an agent who specializes in new construction and knows the ins and outs of what specific home builders might agree to.
4. Help with Contracts
Paperwork, expect tons of it! A buyer’s agent can help you understand the builder’s contracts and disclosures pointing out things you’ll want to pay extra attention to. As you make one of the biggest investments of your life, it never hurts to have an extra set of eyes to review the documents and a knowledgeable representative for extra explanation.
5. Coordination of Timing to Sell Your Existing Home
If you have a home to sell prior to your new build closing, working with the same agent for the new build and sale of your home can be very beneficial. The agent will work closely with the builder on timelines and will be able to use market data to help you time the market right. In best case scenarios, this might help you avoid having to temporarily move before your new home is finished. No one wants to move twice but sometimes it is unavoidable. There are other options and negotiations your agent can provide to help ease the transition with the sale of your existing home.
6. Help Prioritizing Upgrades
Upgrades add up fast, affect your bottomline and impact your final purchase price. Most buyers have to prioritize upgrades and options which can be difficult especially when you’re on a tight budget. A real estate agent can help you determine which upgrades will be best for the future resale value of the home. They will also have knowledge of builder upgrades that are overpriced. Some upgrades are best done when the home is built while others can wait and can be more cost effective to add later. Having built two homes myself I definitely have insight to offer the buyers I work with based on my personal experience.
Experience and expertise is priceless and in this case is FREE. Get a realtor to help you in the new construction process, preferably a realtor that specializes in new builds. The building process can be overwhelming and stressful. It pays to have someone on your side, working for you!
Steps to take when using a buyer’s agent in your new construction process There is often an appropriate process to follow when involving a buyer’s agent in the new build process. Remember realtors work on straight commission and you will want to be sure the builder pays your agent the commission he or she deserves for their time, work and effort in helping you. Here are some general guidelines. Be sure to check with your real estate agent for the process they prefer.
Ideally, take your agent with you when you go to tour the model homes for the first time. This way the builder will know right off the bat that you have agent representation. If your agent can’t go with you, have your agent call the builder ahead of time to introduce himself or herself. That way the builder’s salesperson will know you have representation and will be expecting you. It’s also a good time for your agent to help you get any preliminary questions answered and find out how many home sites are still available in the community. When you arrive at the builder be sure to give the salesperson your agent’s name and business card.