Buying New Construction
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WHY YOU NEED AN AGENT WHEN BUILDING A HOME
Cost to You
Nothing! Any compensation given to a REALTOR is recognized by the builder as a marketing fee and has no impact on the final cost of the home. Builders desire, expect and encourage REALTOR participation.
When a broker registers a prospect at a new homes subdivision, the broker is paid a commission for the sale. If you visit the subdivision without a broker it does not mean the builder will automatically reduce his price by the commission he isn't paying us. And there is a good reason for it when you think about it.
For example, if you purchased a $200,000 home with us, and the builder has a comparable home next door for $200,000 less the broker's commission, say for $194,000, this would have an immediate negative impact not only on your home, but on the value of all the homes the builder is yet to build in the subdivision. In fact, we would not advise you to buy in a subdivision where the builder does not protect price.
Savings to You
Are you getting what you're entitle to have ... both in quality and value? Your experienced agent knows what you should receive and what "extras" might be available. Though it may be difficult for a builder to reduce price (as per the example above), they may be willing to negotiate on options or financing...especially on "spec" homes.
Spec homes are available for a variety of reasons: the builder may be finishing up the last lots in a subdivision, or a contract may have fallen through, or they may have some available for buyers who are relocating and need to move in quickly. Whatever the reason, these homes represent an ongoing cost to the builder until they can sell them. This generally gives the buyer an advantage in negotiations.
New doesn't mean perfect, so consider hiring a home inspector just as you would for a resale. The inspector can help you put together a builder "punchlist" for the final walk-through. Though you will have a new home warranty and many builders are known for customer service, it can save you a lot of aggravation to get things corrected prior to closing.
Resale...Appreciation & Profit
Give your investment the best opportunity for appreciation at resale. Questions concerning site location, builder, design and decor are important. Your agent knows you are building not only for today ... but for tomorrow. Be sure to get builder feature sheets covering everything from floor plans to energy efficiency ratings. These items can help you construct effective flyers when you get ready to sell.
Learn about the community and its amenities, and check with the planning commission on any future construction plans in the surrounding area. Location is extremely important for resale. You should also read any homeowner association restrictions and find out if reserves are set aside to build or repair major amenities like pools or clubhouses.
The higher the base price of the home, the more upgrades and options you can add without overpricing for the neighborhood. Make the most of builder incentives which could include upgrading their standard features at a reduced price (for example, you may be able to get flooring at "upgrade 2" for the price of "upgrade 1"). Options that add usable space, like a sunroom, typically add the most to the resale value. Remember that some improvements can be made later on for less money!
You Are Represented
The agent working in the model home represents the builder, not you. You need an agent on your side who understands the construction process, warranties, financing, and builder differences to ensure you get the best value. Part of the benefit of our services with a builder is the coordination we can provide after the contract is signed. Your agent's experience, knowledge, and reputation represents strength and leverage on your behalf.
Some builders are known for craftsmanship, other for innovative use of space, or customer service after the sale. We can help you find the right home for you. Contact us before visiting any model homes!
