Buyer Agents Beware And Guide Properly | Your Buyer Will Pay Dearly !!

Services for Real Estate Pros with RE/MAX Executive Realty 104763


The listing agent of new homes in subdivisions have many hats to wear, when representing a builder.  The focus must always be directed in favor of the builder.

One of the main tasks is to sell extras. There must be a list of “Frequently Requested Extras” with their respective prices for the listing agent to present and promote at the right time.  The emphasis is “at the right time.”  

The right time is “after the purchase and sales has been fully executed.” Get those spending juices flowing, and remember, “the eye buys.” Be prepared “to show” the finished extra projects and/or items.

This task cannot always be a successful one, and that’s dependent on the sophistication of the buyer. If the buyer has the common sense and is educated enough to secure the guidance of a well-versed buyer’s agent, the extras will be slim to none! Emphasis here is on “well-versed.”

Fortunately for the builder, most buyers searching for a new home do not hire a buyer’s agent.  One of the positive results for the builder is the profit margin on those homes compared to those where a buyer’s agent was on the scene and accompanied the buyer through the entire journey!! 

The listing agent’s job, regardless of the presence of a buyer’s agent, is to sell extras. There is a great profit to be made by many of the popular items and/or amenities to be added. The prices are usually based on what the market will bear. Those numbers may come from an agent who has experience with other builders and their success with selling the extra.

Beware, buyer agents!! Not all extras will hold that value in the future.  There may be a total loss of value with the addition of particular extras. Those are the money makers for each builder. I’ve seen 150% or more profit margin on many items.

Just another thought for the moment……

Posted by


Barbara Todaro

Marketing Agent for The Todaro Team

308 W. Central St...suite E

Franklin, MA 02038


Exclusive Marketing Agent for The Todaro Team


             Copyright © 2009 - 2019 Barbara Todaro

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Re-Blogged 5 times:

Re-Blogged By Re-Blogged At
  1. Elyse Berman, PA 08/13/2018 05:55 PM
  2. Fred Griffin, on leave of absence from ActiveRain 08/13/2018 06:27 PM
  3. Marte Cliff 08/14/2018 11:00 AM
  4. Jerry Murphy, CRS, SRES 08/14/2018 10:11 AM
  5. Erika Rogers 08/16/2018 11:35 AM
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Fred Dorsey
Douglas Realty LLC - Rockville, MD
Specializing in Solutions

Thanks for sharing this info with us. Have a great day ahead.

Aug 14, 2018 11:18 AM #54
Cheryl Hale
Envoy Mortgage. LTD - Plymouth, MI
Mortgage Loan Originator NMLS#276668

Your post is spot on!  So important for buyers to have a "well versed" buyers agent to represent them.  Too easy for the buyer to get caught up in the eye candy and pay more than they should.


Aug 14, 2018 02:06 PM #55
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

In my experience with new homes, I have recommended that extras be limited to things that are not able to be added easily later.  Like extra square footage or a fireplace.  You can change flooring or upgrade countertops and fixtures later.  The markup on wood floors or expensive appliances does not pay off.  Thank you for the informative post.

Aug 14, 2018 05:14 PM #56
Dana Basiliere
Rossi & Riina Real Estate - Williston, VT
Making deals "Happen"


Excellent subject and post!   I have represented builders and have been buyers agent for buyers of new builds.  I have had folks who listened to me and were judicious with the extras and I have had one in particular that went over the top on things that were her taste.  The latter is the worst case.

The local builders around here are not too bad on the price of the popular extras.  It is the custom extras that they over charge.

Aug 14, 2018 05:46 PM #57

Love the post Barbara! Do you know of anything other than flooring and appliances that are at needless mark up,I am working with new home buyers now and would love to know what else to advise them on.

Aug 14, 2018 05:47 PM #58

It's true that builder upgrades bring substantial margins for the builder but after selling new homes for over 20 years there are a few caveats to be aware of. For example the first over priced option everyone complains about is upgrading from the builder standard flooring (probably broadloom) to hardwood. Yes it may be twice or more the cost to do it afterwards but beware. When you keep the standard broadloom so that you can upgrade to 3/4" hardwood after you move in to save a few $$ you might find that all the trim in the house has to be removed and repositioned higher up to accommodate the thicker flooring, plus you will incur additional expense for the shoe mold and it's installation (so you will also require a trim carpenter to do these things) plus if you are in a jurisdiction that includes a full new home warranty as I am in Ontario, let's say your subfloor starts to squeak, you will have voided that portion of the warranty by installing your own flooring. I'm not saying don't do it but I know for a fact (please correct me if I'm wrong and I certainly don't mean to offend anyone) that many re-sale agents don't know enough to coach their clients on this unless they have either sold new homes or bought one and lived through the process themselves. This is just a simple example but I can give this example on many other upgrades as well. On a personal level when I purchased my new home from a builder 20 years ago I refused to pay the "exorbitant" fees they wanted for hardwood floors so promised my wife that I would have it done later and at much less $$. Of course it ended up being about 6 years before I got around to doing it (my wife still reminds me of that)!!

Aug 14, 2018 07:02 PM #59
Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

Great info Barbara, and I love the comment by Karen Feltman too.

Aug 14, 2018 08:23 PM #60
Peter Fuchshuber
ZOLO Realty - Edmonton, AB
Residential and Commercial services

Friends were quoted $75 / ft. for a crown moulding upgrade.  They canceled the house and got their deposit back.  If small things make you uneasy it's best not to proceed.

Aug 14, 2018 09:34 PM #61
Mary Ann Smith,
Keyes 786-278-6598 - Kendall, FL

Excellent insight!  Thanks for sharing with us.  Enjoy your day.


Aug 15, 2018 06:06 AM #62
Barbara Michaluk
Weichert Realtors | Silver Spring, MD Phone Direct 240-506-2434 - Silver Spring, MD
Top Producing / Full Service REALTOR in Marylan

Barbara, this is all good info for buyer agents who are working with someone interested in a new home. Best to be informed so they can represent their buyers well.

Aug 15, 2018 06:15 AM #63
Nick Vandekar, 610-203-4543
Long & Foster Real Estate Inc 610-225-7400 - Devon, PA
Tredyffrin Easttown Realtor, Philly Main Line

There is also the client who doesn't listen, because their eyes have seen, and they upgrade when their is no need. Great post to get us all thinking when showing and selling new construction.

Aug 15, 2018 10:33 AM #64
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

Thanks, Barbara, Nick & Trudy....

Aug 15, 2018 11:51 AM #65
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Now the facts are on the table. Thanks for a great post.

Buyers think the builder rep is taking care of them. 

I see builders who get the buyer to sign the contract, start lot prep and come back and tell the buyer they need 10 truck loads of dirt to bring the lot to level.

That could be another $10,000. 

Buyers you need an agent to represent YOU!!!

Aug 15, 2018 01:13 PM #66
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

John Wiley and that's another reason you need a "well-versed" buyer's agent by your side.... there is research to be done.... a plan of the lot showing the present grade and the proposed grade... and that need to be dicussed.... that's the builder's responsibility to bring in fill or to cut the existing grade....whatever the topo describes....  a well-versed buyer's agent will know how to read the topo and then have a builder's meeting and you'll have the flavor of how the builder handles issues.... the topo has been explained by the agent.... then you'll hear it from the builder... expect the same story!!!!!

Aug 15, 2018 01:32 PM #67
Erika Rogers
Red Rock Real Estate ~ Southern Utah's Largest Independent Brokerage - Saint George, UT
St George Utah Real Estate & Relocation Specialist

It's nice to see this information in writing, I'm going to share with my clients considering working directly with a developer.  Also going to reblog!

Aug 16, 2018 11:40 AM #68
Kevin Mackessy
Blue Olive Properties, LLC - Highlands Ranch, CO
Dedicated. Qualified. Local.

We have seen many homes on the market near us that boast that they have over $90k in builder upgrades, yet the market price doesn't support that.  It can get away from you in a hurry.  On the flip side, it can be great for your buyer to swoop in and buy it at a reduced price.  

Aug 17, 2018 02:32 PM #69
Michelle Carr Crowe,Altas Just Call...408-252-8900!
Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years

Yes buyers mistakenly think they are getting a builders discount, when often, the builders are making a profit on the buyers.

Aug 19, 2018 10:11 PM #70
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Absolutely true...the sales people are working for the builder not the Buyer.

Aug 22, 2018 01:47 AM #71
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Excellent post as always!  Great points for any buyer to understand how a listing agent works strictly for the builder/seller/developer, not the buyer! 

Aug 22, 2018 05:27 PM #72
Patricia Feager, MBA, CRS, GRI,MRP
Selling Homes Changing Lives

Barbara Todaro - Thanks for the wisdom you bring to ActiveRain. You bring us great information to know, especially when it comes to builders. Buyers should choose wisely when they select their Buyer's Agent. Those that are most knowledgeable, builders and buyers pick up on quickly. 

Sep 20, 2018 07:14 AM #73
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