New or Custom Construction: Who is Representing YOU?
Just like the smell of a new car, the feel of a new home with those shiny new appliances, scratch free floors and no worn carpets is so appealing. The home is brand spanking new - fresh and clean, without so much as a finger print on the walls. But wait! What are you really buying and who will be representing YOU?
First and foremost, the builder's sales agents are paid to represent the builder, regardless of what they may tell you. Site agents in the development offices or model homes do not represent you, the buyer, nor do they have an obligation to look out for your interests. They may even encourage you to sign-in or register; by doing so, you may be forfeiting your right to bring back a buyers' agent when you are ready to write a contract. If you go unaccompanied (we don't recommend this!), tell them you are working with a Buyer's Agent. We will gladly accompany you to the development or supply you with business cards to present to the builder's site agent.
Due to the high volume nature of brand new home sales, many will use high pressure tactics to persuade you to sign a contract right away. Most of the builder's sales agents are paid less than a traditional commission, and some earn a salary plus incentives, so turnover is important to their livelihood. Don't sign anything until you've sought the advice of a REALTOR who will be working on your behalf - we are simply a phone call away.
You need a REALTOR that is representing you and you alone, not the builder.
The main benefit of buyers' agency is that buyers can be assured that they have their own REALTOR who is looking out for their best interests. Additionally, this service is "free" to the buyer, because the buyer agent's commission is typically paid as part of the overall seller's commission. Don't be fooled-- for newly constructed homes, the price the buyer pays when they work with an agent, and the price they pay if they do not have independent representation, is the same!
While most development companies build a good product and stand behind their work, it is important to be knowledgeable about your rights, especially information about what type of new home warranty you might receive.
Top 10 reasons to use a Buyer's Agent
- A Buyer's Agent represents YOU, not the Builder
- A Buyer's Agent will review the builders reputation for quality and warranty service.
- A Buyer's Agent will review development guidelines regarding investors. Are your neighbors renting that new home or are all homes owner occupied?
- A Buyer's Agent will review the builder's purchase agreement. These are designed to keep everyone out of court, but they don't necessarily contain language that protects the buyer.
- A Buyer's Agent will review contingencies and cancellation rights.
- A Buyer's Agent will confirm materials used in construction.
- A Buyer's Agent will verify options and upgrade pricing and attempt negotiation for builder incentives. This is where most builders really make there profits. What upgrades can you put in after closing?
- A Buyer's Agent will verify the timeline for all selection items. Does the contract allow the builder to make selections if you miss your deadline?
- A Buyer's Agent will verify with your lender that options and upgrades are included in your financing.
- A Buyer's Agent will verify home inspection timelines. Always, get a home inspection when you buy. The builder will offer their walkthrough. That is not enough! Hire a licensed and accredited individual to perform the inspection. Be there for the inspection and ask questions because a new home can contain defects.
We encourage you to contact us if you are considering new construction so that you know someone is there for you when there are bumps in the transaction: the permits are late, the house won't be ready in time, the carpet is wrong, landscapers forgot to install the sprinkler system, A/C unit not installed properly, the bathroom vents going up in the attic and not outside, the house is the wrong color. These are all real events that have and can happen - don't be on your own if they do.