9 Reasons to Hire a Realtor When Purchasing New Construction

9 Reasons to Hire a Realtor When Purchasing New Construction

August Homewardbound 3

Representation is FREE:

Buyers do not pay commission to real estate agents.  It is the builder who is responsible for compensation & they will NOT discount the home for you if you do not have a realtor!

As builders benefit from self-representation, it is in your best interest to have an advocate whose sole purpose is to represent you and your best interests. Builders often issue contracts containing clever jargon, and your signature could authorize the disguise of your right as arbitration. In addition, builder contracts often stipulate that what you have been told has no validity and that everything must be in writing. For example, a builder could state that a next-door lot is going to be utilized for the construction of an elementary school when in all actuality, the next-door lot is going to house a commercial building. Professional, experienced real estate agents know NEVER to rely on what builders say. 

Greater Leverage & Negotiating Power:

Builders will do everything possible to gain the faithful business of a realtor as they want to establish a relationship with someone who will bring them more clients. This means you have more negotiating power on your side. Builders will always work better directly with the “fisherman” (realtor) than with the “fish” (you).

Valuable Experience Saves You Valuable Dollars:

Realtors are highly experienced negotiators, familiar with all manner of builder contracts, and can spot red flags from miles away. From mandatory contract date assistance such as pre-approval letters from lenders to negotiating high-end upgrades, your experienced real estate agent will know how to navigate through structural issues, lot selection, the orientation of your new home in accordance with sunrise and sunset and will know how to address issues such as energy efficiency in your new build.

An Intercessor:

Troublesome issues are inevitable in a new build: misplacement of kitchen cabinets, wrong paint colors, installation of incorrect fixtures, etc. It is not a matter of “if” issues arise.  It is a matter of WHEN. Realtors understand builder hierarchy within construction companies and will handle corrective processes via the proper channels, protecting you from being “bullied” into paying more for builder mistakes and accepting your home “as is.” Your agent will act as an intercessor, advocating on your behalf for nothing less than what you want and need. 

Builder Kick-Backs:

Builders often work with their preferred lenders, title companies, and other professionals who are willing to discount certain products.  While this might sound appealing, their lenders are not often competitive with market rates, often locking buyers into exorbitant APRs and loan rates. Realtors will always ensure that you have options on the “outside” who do not stand to benefit from working directly with the builder. Again, this protects you as the buyer because the professionals are working solely to gain your business. Therefore they are more flexible in working with you.

In addition, having an experienced realtor on your side when it is time to go over the final contract and inspection with your builder is ALWAYS to your advantage. That extra set of well-trained eyes will help to ensure no detail is missed, that your new home is zoned correctly, that the HVAC system is geared toward maximum energy efficiency, saving you lots of dollars long-term and that every detail is carried out exactly as you have planned. 

Walk-Through:

Walk-throughs are crucial in any home-buying process; however, they are critical with new construction! It is wise to have a realtor present at every stage of every walk-through from the very first meeting, pouring the foundation, framing, all the way through to the final walk-through. In addition, your realtor will know to recommend licensed inspectors who can double-check the build process, ensuring all aspects are handled correctly and up-to-code. City inspectors should not be relied upon as they are known to be more “relaxed” during the inspection process.  Always hire your own private inspector to ensure the process is completed properly.

Financing:

If you are mortgaging your new build, you will need help in comparing fee worksheets, obtaining settlement statements, and cost comparison. For example, one lender might charge one point high for document prep while an alternate lender might charge higher interest. Options are limitless when it comes to lenders and an experienced realtor will know how to offer critical guidance in obtaining the most bang for your buck. 

Closing:

Realtors are pros at ensuring every detail is correctly completed and accounted for and ensuring all issues were properly tended upon the final walk-through. In addition, they will handle all paperwork with the title company to make sure all is correct, ensuring there are no unpleasant surprises at the closing table. Your realtor will obtain your new keys for you and ensure a seamless transition from closing to official ownership. 

After Closing:

The best realtors don’t ditch their clients upon closing. In fact, you can expect to maintain your relationship as your realtor will remind you to file for your homestead tax credit, help with assessment appeals and guide you through any possible warranty issues in the event the builder is slow to address problems. Remember: the builder does not want to lose realtors who bring buyers! 

Working with a realtor in a new build purchase is risky and can be more costly than you could ever anticipate. While you might purchase 5-10 homes in your lifetime, a realtor assists with 20-30 homes per year. It makes no sense to forgo the expertise!

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Phil Aitken, Owner/Broker
Phil Aitken is the Owner/Broker with Your Home Sold Guaranteed Realty - Phil Aitken Home Team and has over 13 years of Real Estate experience. Phil’s faith and desire for his family’s continued security fuel his business growth and leadership. The Phil Aitken Home Team continues to profoundly impact the people of Jacksonville via supporting several faith-based organizations. Phil gives back a portion of every real estate transaction to The Tim Tebow Foundation and Rethreaded. Find Phil's full story here.