MARYLAND BUILDERS MUST EMPLOY LICENSED SALES PERSONS AS OF OCTOBER 1, 2007

Irene.

I usually walk through the model with a floor plan and show the buyers what is an "upgrade, extention, bump-out, option, etc. 

It's an eye-opener for them to actually get a realistic price for what they see and love.

I love selling new homes and have made it a speciality since about 1990.  It was hard in the early 2001-2005 years when builders didn't want to see an agent and many stopped paying us.  But, I love it and I know all of their tricks. 

Sally.  I don't know whether the germ for this legislation came from brokers who want more co-op sales or consumers who made complaints and found that the commission was helpless because the agents aren't licensed.  But, I can't see how this can harm buyers or buyers agents.

Collin.  Thanks for commenting.  I don't know the details yet.  I've get them soon.

Susan.  I agree.  It is amazing the "stuff" that Maryland has let builders get by with for years.  It's been so bad, I wouldn't even sell new home except those built my major builders where they had some quality control.  Builders have to be licensed in MD now for the past 2-3 years.  The Attorney General's office manages the program and things have greatly improved.   

John.  You don't have to tell me a thing about NVHomes or Ryan Homes.  I've sodl a half dozen NV Homes.  BTW, Ryan pays a broker fee in Virginia.  I've sold a few of them in VA. 

I absolutely hate to show an NV Home in MD with a Ryan model right next door.  Ugh.

Chuck.  I don't know how it will affect our practice.  Probably not much.  With any luck, buyers will look at the agency disclosure and say "Wait a minute!!, you represent the builder??  I better go get an agent.

Of course, the problem with that statement is that most consumers don't understand the meaning of the word "representation" here.

Bryant.  I hope so.  It might also make a few buyers think twice about working without an agent.  Fact is, once they are in the model without an agent, it's all pretty much over.  You can't usually go back with an agent and expect them to get paid.

Kaye. 

The question is, who would challenge it in court?  Surely, no buyer would front the $Thousands of Dollars of legal fees needed.  No broker would.  Would the state?  Doubtful because this isn't anything new.  It's a matter of disclosure and the problem, as I see it is that the buyers usually don't understand the value of having an agent with them when they just visit a new home builder.  Fact is, the pathetic representation most agents give with new homes, they buyers are right.  But, it's really more complicated than that because their agent may have also have been showing them resales for 3 months.  Then one Sunday afternoon the buyers drop in to a new home model without their agent and the poor agent is out in the cold. 

I believe that if more agents do what I do and really TALK to their buyers, these things wouldn't happen.  Tell the buyers what's at stake if they intend to visit new home without you.  Talk with them about the market, the financing, the options, the lots, the builder's contract, etc., etc.   By the time I finish talking with a buyer about buying to-be-builts, they're absolutely not going to make a move without me.  With the exception, of course, of the occassional buyer couple who just wants to tour by themselves and then calls to tell you what they found and "would you check it out?" 

"Well, no, I won't.  You visited it without me, you can buy it without me.  Get your information from the builder.  You'll be like a lamb going to slaughter". 

I fired a buyer couple in May this year because of that very scenario.  I'm not going to beg for a commission from a builder.  That buyer knew that I had to accompany them to the builder.  They just figured it would all work out. 

Karen.  I don't really expect major changes.  But, it just might make a few buyers think more carefully when they are sitting across from the builder's rep. 

Joey.  I've seen that happen.  Buyers in this area usually use the builders lender anyway because they need the incentive to pay the monstrous closing costs around here. 

Lance.  Yes.  Yes I do.  And if they insist that they can take care of themselves because, after all, buying a home isn't that hard, I proceed with them as a customer and I clean their clock.  If they ask questions that rise to an agency level, I simply tell them that I can't answer that because I represent the seller.  If they ask stupid questions like how much can we negotiate the price, I tell them that, if they had an agent, their agent would know that I can't answer that quesion.  As far as condition of the property, that's all disclosed and they can have an inspection anyway.  Where the buyer loses is in negotiating price, repairs, etc.

They usually have no respect for REALTORS anyway, which is why they aren't already working with an agent.  After all, how complicated is buying a home?