5 Reasons You Need Your Realtor® When Buying A New Construction Home

Real Estate Agent with Century 21 Award BRE # 01924314

Thinking about buying a new construction home? Don’t forget to bring your agent with you! It could save you big and make you more in the long run.

Looking at pictures of homes you’d love buy can be fun. Seeing those homes in person is just a step closer to the dream. Have you ever considered new construction? Amazing! Custom or tract, doesn’t matter … there’s something sexy and satisfying about looking at the model homes or visiting with contractors and taking a peek sample finishes to really make it your own. In Orange County, CA ... Rancho Mission Viejo is one of the hottest new places being developed as we speak.

Then, you fall in love! You walk through the perfect model. The floor plan is open, you love the upgrades, even the furniture … just … wow!

This is why you need to bring your agent with you.

I get it, I’m the resale agent that wants to “make an easy dollar for signing you in with the builder,” right? WRONG! While that’s (sadly) not uncommon, that’s not what you need me for. Of course, I am in business to help people … and to make money. This is my job. But, you need me … I’ll protect you … so, call me first.

Let’s get the selfish part out of the way. If you have a Realtor® that you generally work with and would like to involve in the equation, you need to bring them with you BEFORE you walk in the door of the sales office at most new construction developments. Don’t worry, you didn’t miss the sign. They don’t have anything out there that tells you that, but no … we (agents) don’t get paid if you don’t bring us with you to register you on the first visit with the vast majority of the builders out there.

That said, I’d also argue that there is some perception out there that new construction is just “easy money” for a Realtor® like myself. In fact, some buyers understand the process but just don't care because of that perception. They just don't see the value in involving another person. I just have to walk you in the one time to get paid right? Well, technically, that’s true … however, it’s not the service that you should be expecting from an agent that joins you to preview homes with the builder. Your Realtor® should always be working for their money and on new construction … there is certainly work to be done.

So, what should you expect and why do you need a resale agent for new construction? Great question!

1. Remember, the sales agent that represents the builder … works for the builder. They do have a fiduciary obligation to you as a buyer but (and it’s a big “but”) … in the end, they really only have to dial in your housing needs the one time. See, they won’t be the one reselling it when you are ready to make the next move … I will.

But, why is that so important? Another great question. Often times, the builder’s agents will talk about the surrounding community developments as well. The roads, the schools, the parks and so on. What happens when the construction is done, the community is built, the builder is gone and that “small road” behind your house is screaming like Antonio Parkway? I bet they told you not to worry, the sound barrier glass fence should help and the view is more important. W.R.O.N.G. But again, not their problem anymore because they are long gone and you’re stuck with what you have. I actually saved a family member of mine that almost made that exact mistake. They would have been in a position on a home where this exceptional view would have been worth just about nothing since the long term plan was to build a major parkway behind the house that hadn’t yet been developed. In mentioning that during their home tour, the builder’s agent even pushed back at me and said “it won’t be that bad.” I got a huge “thank you” from my buyer after that meeting and they bought a home with a view that will actually have value to them in the future. Had I not had this conversation ... they may have signed a contract on a home that ultimately would not have accomplished the goals they were looking to achieve. There could be major consequences to those actions and getting out of a signed deal is not always easy ... especially if it's just buyers remorse.

Sure, you can try your hand in court to remedy a misrepresentation like that by the builder's agent. Just remember, the builders have a lot of money … usually more than the buyer of the home and they’ll make you spend a ton of money fighting for what you admittedly deserve but likely won’t end up getting.

So the point? As the resale agent, I’m there to help make sure you are paying attention to things and to ask questions about stuff that you may not otherwise think about. I can bring value because I don’t just look at the home you are buying now … I think about what buyers like and apply that to how it will impact you down the road when you go to sell it again.


2. Did you know you can actually make an offer on a new construction house? Yeah, you can! You don't have to just give the builder their list price. Did the builder tell you that? Probably not. Now, there’s not always bargaining power and you need to know where to play your hand but I’ll tell you what … standing inventory (that would be homes that they are done building that have not been purchased yet) are AWESOME homes to try and negotiate on. The builder may have had a buyer and lost them, or maybe it’s not a favorite lot and location but for the right price it could be a good money saver for you that could have potentially nice returns later. They also may have built too fast or the market changed and demand dropped … there’s a ton of reasons the home is not sold yet. All we care about is that it’s an opportunity that you may consider taking a stab at.

The reason you have a little negotiating power is because the builder has less control of the demand on homes that are not yet built, as long as there is something already out there that someone could quickly move into. Plus, the builders don’t want to be paying taxes and carry the cost of that finished home. They will just be sitting there losing money.


3. Isn’t it nice to have an extra set of eyes on the process? New construction has problems too, you know. It’s a good idea to have someone reminding you to visit the construction site and maybe even to join you to walk through and make sure that everything is as it’s expected to be. Hell, I had one just last year where the builder's workers had been nailing empty beer cans to back of the studs and they were just about the start putting up the drywall. Nice that we caught it! We were able to make sure that crap like that … or the empty sandwich and chip bags weren’t just sealed up in the walls.


4. Because we have absolutely zero loyalty to the other side. Now, we can’t always fight the builder for you (because in their eyes ... they are your agent and we are just taking a "referral") but we can certainly give you advice and (where appropriate) have some conversations when necessary. It’s just nice to have someone on your side that doesn’t have skin on both ends of the deal. I’m not saying they can’t represent you fairly … in fact, I’ve represented both sides of many of my own listings. That said, the difference is that I am a resale agent … … … so again, I’m not selling you the house just the one time and then onto the next builder project. No, I actually value our long term relationship because I want your business and your referrals. I want you to make money. I need to be able to sell it to another buyer in the future ... see where I'm going?


5. To keep you from falling in love with things that don't matter ... furniture, upgrades and landscaping. Hey, if you can afford it and you want it … more power to you. BUT, there are just so many people that buy new construction for the first time and don’t think about the fact that they are most likely not buying the model. Many of the finishes are upgrades and are not included in the base price. The furniture is staged and your home will look completely different. And, I can’t tell you how many buyers don’t realize until the home is just about finished that they are not financing the landscaping into the mortgage. Did you know that? Yeah. No joke. So, spend all of your money on the down payment and make your move ... leave nothing for the "nut" you'll have to pay for landscaping and you'll definitely have a problem on your hands when you can't even afford to put the grass down.

I’m here to make sure you are in love with the right things. It’s like your girlfriend who said “yeah, he’s cute but he’s just such a jerk.” Or, have you ever heard the saying about “lipstick on a pig?” You have to see past the furniture. You have to know that the home will work within your budget, which may not include many of the upgrades you saw in the model. You have to remember that the landscaping is not included. You may love the built-in BBQ and the fireplace but can you afford it? If not, make sure you can live without it or consider buying something that would leave enough budget in the end to put add it after construction in complete.


Look, builders like to make it seem like they have tons of control. And really, they do. But, having a resale agent in your corner can help you identify opportunities to save money or make more strategic and longer term valuable decisions when you are purchasing. We are here to make sure you’re not getting in over your head. We’re here to make sure that you are taking everything into consideration and seeing the home for what it really is … with and without furniture, upgrades and landscaping.

Many builders pay far less than the average commissions earned by a Realtor® on a resale deal. In fact, that’s why many agents don’t want to work at all after they walk you though the door. But, I’ll work for you the whole way through … any agent should. This business is about people. It’s about relationships. The result is that the Realtor® makes money but the goal is that you’ve been guided not only to a home that is right for you now but that will grow positively for and with you into the future.

If you’re thinking new construction … give me a call. I’ve got your back.


Check out more fun stuff and read more or my blog posts at www.JamesHoffCA.com


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