After several years of muted activity, new home builders are back in a big way in our area. There are many new home developments that offer a wide variety of home choices. For some buyers, there is nothing like having a brand new home! Having represented many buyers and sellers of new homes, we can help you navigate the myriad issues that can arise along the often months-long transaction period. The recommendations below are a result of the experiences we have encountered in the process. Remember, if you are considering new construction and wish to be represented in the transaction, you must have your agent with you on your first visit to the builder’s sales office.If we are not there, you will end up unrepresented unless you agree to pay us yourself.
· While almost always knowledgeable and professional, a subdivision agent works for the builder exclusively, and they are contractually obligated to work in their client’s best interest at all times. A buyer will ultimately be presented with a contract that has been written to the builder’s exact specifications, geared to favor the seller. While not authorized to offer legal advice, we are very savvy when it comes to clarifying the process for buyers and protecting them from negative surprises. Without their own agent, buyers are relying on the advice of the seller’s agent, who owes them no fiduciary responsibility or allegiance.
· An experienced representative will ensure that the buyers are making informed decisions. This should include an investigation of the builder’s licensing status, history of complaints and overall reputation. In addition, we feel that every buyer should view the competing re-sale competition if only for comparison purposes. Other considerations include your lot selection, upgrades and options. A skilled agent will point out the features that lead to higher prices when it comes time to sell. For example; perhaps you’ve found an otherwise great home that lacks sufficient kitchen counter space; installing a center island during construction will be much cheaper than adding one later.
· Usually, the builders offer a commission to the buyer’s agent whether they have one or not. They prefer to have you unrepresented though, so if one of us are not with you when you register the first time at the development, they will not pay us to represent you. That is their “policy.” Buyers sometimes think that they could negotiate a better deal if they don’t have an agent representing them. That is untrue nearly all the time because builders are very reluctant to reduce their prices. For appraisal purposes, reduced prices would negatively influence the value of every similar home they have sold and plan to build in the future. Builders typically write off cooperating commissions as an overall marketing expense rather than attaching them to the outcome of one transaction.
You won’t need a salesperson in this transaction, the builder will provide one for you. What you will want is an experienced advisor willing to attend your critical appointments with you. This extra set of eyes and ears along with a commitment to your best interests will lead to a smoother, less stressful transaction. Let us know when you wish to visit new home developments and we can arrange to be there with you.