Why to use a Realtor for New Construction

by | Mar 4, 2020

Buyer Representation in New Construction

Many buyers often don’t realize that real estate agents can also represent them when purchasing a new home. The compensation works the same – commission is paid by the seller, so it is still a free service for the buyer to use a Realtor for new construction!  If you work directly with the builder, the builder will have an agent representing their fiduciary interests and you will be representing yourself in the transaction.  If you do not have experience with the new construction process, understanding lengthy builder contracts, and negotiating with contractors and builders, then it is highly suggested to have guidance from an agent.

The new construction process is much more complicated and risky which is why its important to have an agent walking you through the entire process, from selecting a neighborhood to closing.  Working with a knowledgeable Realtor can limit unexpected surprises by asking the correct questions and provide a set of eyes and ears to constantly monitor the 3 to 4 month process.  They can also negotiate to create a better deal for you!

Our Hunter Rowe agent helped us get a brand new granite bathroom counter top because the seam in ours was not in the model home we had originally viewed. After multiple people telling us “no they wouldn’t replace or fix it,” she called us to tell say she got them to agree in making the situation right. She fought for us like we were her very own family.”

-New Construction Buyer

When looking at new construction homes, don’t accidentally give up your right to be represented by an agent of your choice.  Be sure to thoroughly read everything you sign while visiting on-site agents.  If you are currently working with an agent, let them know you are represented by giving them your agent’s business card.

New Home Negotiating Techniques

In a development, the sales manager’s priority is to maintain or increase the price of homes as they are built, which can make negotiating difficult. However, there may be opportunities to get certain options added for low or no cost, since they will not show up in the public records available to past or future homeowners.

Recommended Process:

  1. Temporarily reserve the lot (usually with a non-refundable deposit)
  2. Work quickly with your agent to make a list options you desire in priority order
  3. Send your agent to deliver the message, “We want to build here, but are up against our budget limit to afford the home we want. If you could provide X, Y, and Z options at your cost, we’ve got a deal.”

Examples of recently negotiated options are fences, appliances, stone facades, and design-center credits.

Please note: If the rate of sales in a development is brisk, there may literally be no room for negotiation and you may have to choose between paying the price they are asking or not building in that development.