Do you need an agent when buying New Construction Home?
How to lose money buying New Construction Home
If you don’t care if you loose money, go alone. Don’t hire an agent. Rely on what you think. Trust the builders representative. Its just that easy to lose money on a new construction home when you don’t hire your own agent.
Watch this video about how local Orlando buyer lost $40,000 when he purchased a new construction home without an agent. Learn from his costly mistake.
This aired yesterday, so read full details. This buyer purchased a new construction home through a national builder. He lost $40,000 because he did not understand timelines in the contract. Most homebuyers do not understand even a fraction of what they are signing…
$40,000 of your hard earned money gone
Still think you don’t need an agent to buy a new construction home? Every homebuyer needs to hire their own agent for the following reasons: Many buyers become blinded with the beauty of a brand new home and all the luxury upgrades shown in model homes. Wow! Even the sales person (who works for the builder) is so nice, too!
The buyer than becomes friendly with the builders onsite sales person and dosen’t realize the business details behind this highly emotional purchase. This is why you need your own agent to help keep you grounded and aware of all the nuances. After all, not everything is as it seems when buying a new construction home. There is also the small print in your 30 page contract.
The sales person is not your ally
The sales person on the new construction home works for the builder not you the buyer. The sales person onsite will smile and answer your questions about the process. They will not however tell you the negatives about the home or community. They will not tell you about the pitfalls in the contract. They will also not remind you of timelines in the contract to stay compliant. None of the sales representatives will tell a buyer that there are no appraisal contingencies in the contract. Don’t be surprised about upgrades in the new construction home, either.
Since the friendly salesperson works for the builder, you are for sure on your own. Unless you hired a buyers agent…which costs you nothing. Builders will pay the Buyers Agent a commission and the base price of the home stays the same. There is absolutely no discount for buyers that come to buy a new construction home without their own agent.
What a good buyers agent does for you…
Reads the Terms of the contract: Before every new construction home purchase Buyers Broker of Florida will review the contract. We highlight any “buyer beware'” issues and make sure they buyer understands the terms. Believe it or not, sales people that work for the builder do not understand their own contracts. There are even some builders and sales persons that are not allowed to explain the contract to the buyers. Buyers Brokers are familiar with all the Florida contracts. We can help.
Compliance with terms and timelines: All builder contracts are one sided for the benefit of the seller, not the buyers. So its important when we discuss and monitor terms and deadlines in the contract. If the buyers are not compliant with the new construction home purchase, they could be in breach of contract and at risk of losing their money…just like the video.
Tell you the Negatives (and Positives): We have make sure our buyer clients stay informed even if means buying later or in another community. Buying a new construction home can be confusing.
“Recently, I had a buyer fully ready to go to contract on a lot the buyers thought was wonderful because the sale person told them that it was wonderful. Salesperson emphasized the privacy of the lot at a premium of $8,000.
When I looked at the lot with an experienced eye, I told the buyers not to buy it. The lot backed up to lift station and a road, which are huge negatives on the resale market. Taking my advice, the buyers waited 2 weeks longer to purchase a newly released lot for the same price that was bigger and had a pond view. Much better value for the new construction home lot.”
Attend Meetings and Inspections on Your Behalf: Many of our buyers are out of town and cannot attend construction or inspections meetings, we attend to make everything goes smoothly and there are no surprises. When you do not have your own agent to buy a new construction home some things will get overlooked.
Resolve Problems: Sometime issues come up in transactions, and buyers will have us as an ally to help them deal with the builder. Many times buyers cannot fly down, have time, or feel comfortable dealing with problems. You need an agent that knows the ins and outs and is willing to actively mitigate issues in your best interest.
Buyers Broker gives you options: Builder sales person will not tell you about your options even small ones, such as getting a remote closer, or digital signatures, or making sure your termite bond and warranties are provided. We always think of ways to make the new construction home transactions easier for our buyers. Like we recommend putting your deposit money in an escrow account instead of the builders pocket to use. These are all defaults in the contracts which buyers overlook and other agents don’t bother to read.
Save Money: There are times when builders are negotiable, and a Buyers Broker can help a buyer seize those opportunities. We know what to negotiate on a new construction home. Some homebuyers mistakenly think that if they come alone, the price will be reduced. Not a chance! In fact more than likely you will NOT get the best deal.
Help with Financing and Title Company Issues: The builders sales person are not educated on the finer details of financing, title or accurate closing figures, because they are not heavily involved in this part. Buyers Broker routinely deals in this arena in both resales and new construction. We check to see if the charges to the home buyer are accurate and you are not being overcharged.
Smart Home buyers always hire their own agent. What the media says. Talk to a Buyers Broker for a free consultation. Do not be one of those buyers that call our office for help after they signed a sales contract and are now stuck. Buyers Broker of Florida. 407-539-1053.