Even if you're buying a brand-new home from a builder, it's important to have an agent representing your interests.
Selling a home? Get a free home value report
Buying a home? Search all homes for sale
As a home buyer working with a builder of a new construction home, it's important to have representation. Why is it important to work with an agent when buying a new home? Today I have Susan Titus with me to discuss this issue.
First of all, the representative at the builder’s site works for the builder, so their goal is to maximize the builder's profit, not to protect your hard-earned money. Secondly, you have to remember that when you look at model homes, you're seeing dressed-up homes that have upgrades that aren't included in the price of the home. You should also know that building companies may offer incentives to work with companies like their own mortgage company, but the loans offered may not be the best deal for you as a buyer in the long term.
The most important thing to remember is that the contract favors the builder. Working with an agent will give them a chance to help you understand the risks, timelines, and requirements. They can also help negotiate some fees that may be standard to the seller that the builder isn't normally apt to pay.
“
”
You may be wondering why you can't save the cost of a buyer's agent's commission just by working with the builder. The cost of commission for an agent is actually built into the price of the home. Even if you don't work with an agent, the builder is not going to discount you that cost of a commission; they're going to put it in their pocket as profit. The builders want the prices to appraise and continually escalate, so they will not give you a discount just because you didn't have a representative helping you.
The representative works for the builder, not for you.
”
Also, know that you can't go out looking at model homes, find one you like, and then call an agent and ask them to write up a contract. Your agent has to accompany you on the site or call and register you with the builder before you go on site. If you go to the site without an agent, you will be tagged, and then you will not be able to be represented if you decide to go back with that agent.
I hope that clears things up for you when it comes to working with builders and the process of buying their properties. If you have any questions, give us a call or send us an email. We'd be happy to help you out!
