Last updated on May 11th, 2023 at 06:04 pm
Thinking of buying a newly constructed home? Why not drive to the development and look at their product on your own? Oh, you believe the urban legend. “Buying from the builder will save the real estate commission and reflect in your price”. Read further, you need to hire a real estate agent for new construction.
Buying a newly constructed home is a challenge different but similar to buying an existing home. The first thing that a prospective buyer will find if going direct is that there is no benefit to doing so. This is how most builders sell their products.
If you go direct to a builder, you have no “partner” to assist you through the process. More specifically to point out issues that arise in new construction. Hiring a real estate agent to help you through the search part of the process is important.
Hire a Real Estate Agent to help buy a new construction home
Experienced agents know about all of the new home projects in their usual marketing area. Some knew what was on the land before the start of construction and others know about the permitting and hearing process. While the builder must provide information about serious issues in the area, they may not know of others.
Some builders will negotiate, and others will not. A good agent knows those that will and how far they will go with price or options. Agents familiar with the developments will know if and where the builder cut back on refinements.
The simple fact is that you do not pay for the assistance of your partner agent, they are paid by the builder. You know that money you thought that you would get, well that would go to your partner. Your price will be fixed regardless so why not have the free assistance of an expert?
If builders agree to “cooperate” with your agent, they have decided that for that project, they must pay any real estate agent who brings them a willing and able buyer according to state real estate regulations. These regulations which are somewhat nationwide prohibit “kickbacks” or other forms of refunds from builders to buyers.
Have you seen all the new homes in the area?
You may fall in love with the first development you see. Builders generally employ good real estate salespeople who can “help” you make a decision. What about the homes you did not see? Is there a better neighborhood e.g. closer to work, park nearby, schools have higher ratings?
Some people look for a new home because it’s what they think they want. Some things to consider when buying new are:
- You may need to modify the landscaping
- Install hooks, fans, lights, etc.
- Clear land, expand grass, irrigate
- Rain gutters are not usually supplied in new homes
- Some things do not work properly
- Additions e.g. pool, outbuilding, paving
A talented real estate agent may want to take you by an existing home that meets and perhaps exceeds your needs within the lower end of your acceptable price range. In other words, a move-in ready home for similar or less money than the new house.
In some cases, there are homes in the new development that were purchased within the last year that is now for sale. The difference is that the seller may be willing to negotiate, perhaps they purchased the home for less.
A “newish” home in the same development
Your search is all about options. If you are certain that you want something new, great. If you would explore “newish” along with the new, even better. The more options you give to your real estate partner the better for you.
Should you decide you want to buy a home and that new construction is the direction, contact your real estate agent first. Most builders will not “cooperate” with a real estate agent after their employee has expended time showing you their products. You need to have your agent with you when you go to the new home model or if you want to contact the builder, have your agent set an appointment.
If you are buying from afar that is, you are out of state, a local partner is essential. There are stages in the building of the property that requires you or your agent to visit and inspect. Particularly if you have added some structural additions e.g. fireplace. Take this from experience, things happen.
Things happen when homes are being built
One time I was buying a home and my agent dropped by during the phase when bath fixtures were being installed. I had ordered a tile shower instead of a molded bathtub shower unit. She found they had installed exactly what I did not want. The tub unit was fully framed. They un-framed the bathroom and pulled out the bath unit.
Another time, we had told the builder to raise the ceiling in the second-floor bonus room. Our agent stopped by and found that they failed to lower the ceiling. They tore out the first one and put in a new one.
Considering building your own home?
Some people like building their own homes. Before you start, hire a real estate agent to help find the perfect property. The Real Estate Agent can put you together with an architect and builder. During the process, your agent will keep in touch and take photos.
As of this writing, I am working with clients who are in the construction phase. Having first purchased a lot near the beach, they have gone through the planning and lending stages. The house is currently under construction. The clients receive a weekly video of the progress. They can see what is going on as close to real-time as possible.
There is no cost to the clients for this service but it’s essential to the process particularly when you are not living in the area. You need a real estate agent regardless of building your own home or you are buying new construction.
You need someone to represent your interests
So, you need someone looking after your interest during construction. Also, if the home is finished and you can not come for the walk-through, your agent can stand in and point out any defects.
After a few years, perhaps many, you may decide to sell. Who knows your house almost as well as you do? Your agent. Who better to represent you in the sale of your property?
If you are interested in buying or selling property, please visit our affiliate partner Logan-Anderson, Gulf Coastal Realtors.
