We'll throw in a fridge but that's it!

By
Real Estate Agent with Prado Real Estate South UT DRE# 6541633-SA00
https://activerain.com/droplet/ZsB

We'll throw in a fridge but that's it!

We'll throw in a fridge but that's it!

That is what the on-site agent told us as we began talking about new construction pricing within the townhome community. More or less, there was zero negotiation power when it came to the product.

  • This is a typical situation where the builder has a set price and will not negotiate down, only up for the features and upgrades in the home.
  • They are firm with their processes and have comparables to substantiate their price point.
  • Also, the builder chooses the title company that will close their transactions and lender to pre-qualify.

If a buyer wants closing costs paid, the builder is more than willing to raise the price to accommodate but they will not lower the price. This information should be shared upfront to avoid any misunderstanding once a decision to purchase has been made, otherwise the buyer may feel the builder is controlling both sides of the transaction.

After learning how the new construction pricing works in this community, the next question would be...Are you ready to proceed forward?

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To discover sunny southern Utah for yourself, go to: www.buynsellutah.com

 

Wanda Kubat-Nerdin REALTOR Southern Utah www.buynsellutah.com

 

 

Member of the St. George Area Chamber of Commerce

I, Wanda Kubat-Nerdin at PK Real Estate Utah am responsible for my opinions expressed in this blog. Information herein is deemed to be reliable but not guaranteed and may change due to market conditions. Please do not take my pictures or artwork and use them as your own, they are my property,  Copyright ©

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Rainer
258,539
Matt Kombrink
RE/MAX All Pro - Saint Charles, IL
Your #1 Source For Real Estate

Wanda, thanks for the post.  You would think builders in this market would be a little more eager.  I think it is definitely best to have some representation when a buyer walks into a builders sales office!

Aug 08, 2013 11:40 PM #1
Rainer
408,723
Dan Hopper
Keller Williams Realty Downtown LLC - Denver, CO
Denver Realtor / Author / Advocate/Short Sale

Wanda, thank you for your insight into the new construction philosophy with this builder.  It is one example of how this builder views their base price and market values within the community, and what items are negotiable.  We find many different negotiaing practics across the board in our area, yet they will always find a way to entice the buyer into buying their product over the builder down the road.

Aug 08, 2013 11:49 PM #2
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Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

Wanda, It says very strongly that it is a seller's market and the builder is calling the shots. We haven't been there in a very, very long time.

Aug 09, 2013 12:17 AM #3
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Matt, I agree that buyers need representation when purchasing new construction.

Dan, Some builders have their product completely spec'd out and know their bottom line on very unit. It takes the negotiation completely away from purchasers. Some are okay with that and some feel led by the builder.

Debbie, It seems to be a seller's market here as the list to sell ratio is at 97%.

Aug 09, 2013 01:19 AM #4
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Anna Banana Kruchten - Phoenix Homes Sales
Phoenix Property Shoppe - Phoenix, AZ
603-380-4886

Wanda that pretty much sums up what's going on in our market.  They may offer an incentive but you know it's built into the price.  Buyers do need their own representation on new builds - absolutely.  Many just don't know that - they think they are being represented by the builders agent but of course we know that's a dual agency.

Aug 09, 2013 01:53 AM #5
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Anna, New construction is picking up and some builders can drive the price if it is a desirable community!

Aug 09, 2013 02:35 AM #6
Rainmaker
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Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Wanda,

We understand, after all, they have suffered through the recession, and the demand is now there.  A

Aug 09, 2013 05:29 AM #7
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Alexandra, Builders who do the same style and type of home time and again have everything in place and usually will not deviate from their standards to accommodate buyers. Buyers either will purchase on their terms or go elsewhere, those are the choices! 

Aug 09, 2013 05:36 AM #8
Rainmaker
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William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

We have to be very clear and concise for buyers.  And sellers for that matter.

Aug 09, 2013 06:00 AM #9
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

It's true Bill and makes the process much smoother with less unexpected surprises!

Aug 09, 2013 06:04 AM #10
Rainmaker
1,431,210
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

Around here the builders do not really need to negotiate these days.  There is so much demand.

Aug 09, 2013 08:14 AM #11
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Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Gene, When that happens, there is no room for that, I agree!

Aug 09, 2013 08:19 AM #12
Rainmaker
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Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Great points, Wanda.  We've been able to negotiate some updates with many of our developers, but they do not want to show lower value sales as this will affect their comps.

Aug 09, 2013 10:41 PM #13
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