Why do you need a Realtor when buying from a builder?

27 June, 2015

You may be in the market for a property for sale that includes new construction.  When you go to a new home builder’s site, there are sales representatives there that work for the builder to sell homes.  They will tell you that you do not need a Realtor to purchase the home which is correct, but there are many reasons that having a Realtor by your side through the process will help ensure that you are getting the best value in a new home and that you are making the right decisions throughout the process.

Be sure to take your Realtor with you on your first visit and don’t register in the office unless your Realtor is with you.  If on your first visit, your Realtor is not with you, even though it’s worked into their costs, the builder will not pay your Realtor their commission.

Here are several reasons that you should use a Realtor when purchasing a new construction home.

Market analysis – some think that the price set by the builder is non-negotiable, this is not true.  Everything is negotiable in Real Estate from the sales price to closing costs.  The sales representative will not tell you to negotiate because they work for the builder (seller).  In addition to knowing how and what to negotiate, your Realtor will help you figure out the fair market value of the home.  Knowing the value of your home is important so you have an idea of what you can sell your home for if you may sell in the near future, that you’re paying fair market value for your know and having the peace of mind in knowing that you didn’t overpay for your new home.

Representation – the sales representative that you will be working with when buying from a builder works FOR the builder, not for you.  Having a licensed Realtor means that they have a fiduciary responsibility to you which means they are looking out for your best interests.  Licensed Realtors are also held by high standards of ethical practice, sales representatives are not licensed and not held to any such standards.  This leads me to ask, why wouldn’t you want someone there by your side looking out for your best interests while you’re making one of the biggest, if not the biggest purchase of your life.

Inspections – all sales representatives who are working for the builder (seller) will tell you with a that you don’t have to do any inspections,  they will tell you this is a new home and will come with all the paperwork and warranties you need.  The warranties they speak of will not fully protect your home and it’s always important to have a third party inspect the property.  Most likely there will be nothing wrong, but you don’t want to have the house with a major problem that could have been discovered by an experienced and reputable home inspector.

Contracts and the fine print – you may get overwhelmed by all of the paperwork and the sales rep will most likely give you a summary of what you are signing.  A Realtor will take the time to read over the documents with you and answer any questions or discover any red flags before you sign.  Although most builder home contracts are “standard”, this does not mean that you don’t need to read it.  Always read anything you’re signing – a Realtor will help you navigate through all the pages and if you still have any concerns, because Realtors are not attorneys and should not act as such, reach out to your lawyer.

Commission – the commission that your Realtor would make is paid by builder and most likely already built into their costs.  If they don’t have to pay a Realtor, the sales rep would most likely get a bonus and the builder pockets the rest.  If you can be represented by an ethical and licensed professional for free, why wouldn’t you choose to do so?


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