Looking at buying from a builder -- should I get an agent?

[doss]

Hi all,
I am looking at buying a new house in a subdivision where the builder is currently building new homes. The sales agent is also the builder. Before I walk into the office, should I already have an agent to represent me? Do I need one?

[Yooper16]

Nope---- you really need to have your lawyer review all contracts regarding the build and sale. Be prepared to consult with him and the builders rep should you have any questions on change orders, local inspections etc.

My parents did a new build in the late 90s-- used the builders real estate person to coordinate with parents bank for mortgage, title and with parents lawyer for review and questions..

[ChampCamp]

Find a great agent and ask what he/she can do for you in this situation.

[Sandtrap]

If you did retain an agent:
1. Would the use of one get you anything cheaper, or more for the same price?
2. Would the agent's services cost you for something you already had using the development representatives/sales office?
3. Would using an agent get you any more guarantees, bargaining power, or assurances, etc, that you would not otherwise get anyway without one?

[BruDude]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

[pshonore]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

[InvisibleAerobar]

piggy-backing on this; one should still get an inspection, correct?

[FederalFIRE]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

These builders may also roll in the cost of the commission that they have to pay the buyer's agent into the bid price on a new home, so you'd just be paying more to get some of it back in a check from the buyer's agent.

The advice about having a lawyer to review your contract, etc. is sound. The need for a buyer's agent is, in my opinion, non-existent. If you have already decided that you're going to buy in this neighborhood, and this builder is the sole offerer of homes, the buyer's agent will likely do very little for you except complicate the process.

[FederalFIRE]

piggy-backing on this; one should still get an inspection, correct?

Yes. This should happen whether you have an agent or you're executing a direct private sale (or anywhere in between). Definitely wise to make sure you know what you're buying at the price of a house.

[miamivice]

Hi all,
I am looking at buying a new house in a subdivision where the builder is currently building new homes. The sales agent is also the builder. Before I walk into the office, should I already have an agent to represent me? Do I need one?

Generally, a buyers agent will only get commission if he/she is with you on the first visit you make to the sales office.

If you have been there before, you are probably out of luck.

[miamivice]

piggy-backing on this; one should still get an inspection, correct?

Getting an inspection and having modifications made are two different things.

The only recourse you have if your new build home does not "pass inspection" is to back out of the sale. Depending on the contract you signed, this might mean you forfeit your deposit.

There is no guarantee that the builder will make any changes based on your inspection.

[FlyAF]

I didn't use a buyers agent for this and after going through the process once, I'm not sure they would be of any help whatsoever.

[8foot7]

I've bought two new houses and used an agent both times and regretted using an agent both times. This immediately previous time I didn't even know we had an agent; apparently my wife had signed something electronically when she was asking a friend general questions and wham! there is an official relationship. I was not happy.

Get a rebating agent or do without and negotiate on an options allowance (larger home builders generally won't move on price for various reasons but will credit many upgrade options or provide an allowance at their design center or provide additional structural features like a porch or sunroom). Resist the siren call; a buyer agent on a builder transaction does laughably little, so little as to be indistinguishable from nothing.

[mak1277]

If you've already decided that you want to buy from a specific builder in a specific community, then I don't see what benefit a realtor would bring you.

[pshonore]

See if the builder has a Spec book. This will tell you everything about the house as far as materials used, construction methods, allowances for lighting, flooring, etc. Also find out what upgrades are available and how much. As an example, when I was selling I had a builder who would not put in Central Air. (This was quite a few years ago and most new construction did not have CA) His reasoning was he had good control over his subs and did not want to bring in a new sub which might cause building delays, quality problems, etc. Same with kitchens. Of course you could customize your cabinets for an extra charge but only through his cabinet guy.

[Broken Man 1999]

OP, it boils down to a trust issue.

We bought our present home from the builder. We actually traded in our other house with him. Worked great for us, he was a very respected builder in our area. He owned all the lots in our small subdivision, and was involved in all the homes built there.

We requested some upgrades as a sweetener to buy, some we received, some we didn't. He is in his eighties and last year he checked our roof for us. Wife was scared to death he might fall, no problem, he did fine.

Over the years we have used him for various projects. Honest and fair.

Broken Man 1999

[InvisibleAerobar]

piggy-backing on this; one should still get an inspection, correct?

Yes. This should happen whether you have an agent or you're executing a direct private sale (or anywhere in between). Definitely wise to make sure you know what you're buying at the price of a house.

piggy-backing on this; one should still get an inspection, correct?

Getting an inspection and having modifications made are two different things.

The only recourse you have if your new build home does not "pass inspection" is to back out of the sale. Depending on the contract you signed, this might mean you forfeit your deposit.

There is no guarantee that the builder will make any changes based on your inspection.

thank you both for the helpful responses

[DanMahowny]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Thanks man. I did not know this.

[ncboiler]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

This is the main reason to have a buyer's agent for new construction. Here in NC I found an agent that rebated 2% of the purchase price back at closing. I only talked to him a few times as I didn't really need assistance from an agent during the process.

The only thing to be careful of is that the rebate can only be used to offset closing costs and can't be rebated back as cash or to offset the purchase price. I had to be a little creative to structure closing costs to make sure I maximized the credits I got from the rebate.

The rules probably vary from state to state so make sure you know the rules for your state.

[BruDude]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

[Retired2013]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

[SevenBridgesRoad]

Nope---- you really need to have your lawyer review all contracts regarding the build and sale. Be prepared to consult with him and the builders rep should you have any questions on change orders, local inspections etc.

My parents did a new build in the late 90s-- used the builders real estate person to coordinate with parents bank for mortgage, title and with parents lawyer for review and questions..

I completely agree with this. It will be money well-spent.

[BruDude]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

Most builders won't lower the sale price a penny because it affects their comps

[pshonore]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

[mak1277]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

[Retired2013]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

Most builders won't lower the sale price a penny because it affects their comps

My neighbor said he told the builder if he didn't provide a credit to the base price, then he would bring in an agent and the builder could then pay the 3 - 3.5% commission to them.

Sounds similar to getting an agent and then getting a rebate except your skipping the second agent.

[mak1277]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

Most builders won't lower the sale price a penny because it affects their comps

My neighbor said he told the builder if he didn't provide a credit to the base price, then he would bring in an agent and the builder could then pay the 3 - 3.5% commission to them.

Sounds similar to getting an agent and then getting a rebate except your skipping the second agent.

That's possible, but many (most?) builders will only allow a realtor to go on the contract if they are present at the first visit to a model or community.

[pshonore]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

Obviously you've never been a selling agent for new construction. When the contract is signed is when the work starts. "Hi Mrs Jones - the builder wants to know if you want a raised hearth with the fireplace or one on the floor? A few weeks later - "Have you picked out your carpet yet? They would like to install next week" - "Yes Mrs Jones you can have different color paint in the bedroom but that will be an extra charge" The list goes on and on. Also most new construction in CT is listed at 4%. That means 1% each to the listing agent, the listing broker, the selling agent and the selling broker (granted one person can play more than role). If you are very lucky, you'll get .5%

[mak1277]

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

Obviously you've never been a selling agent for new construction. When the contract is signed is when the work starts. "Hi Mrs Jones - the builder wants to know if you want a raised hearth with the fireplace or one on the floor? A few weeks later - "Have you picked out your carpet yet? They would like to install next week" - "Yes Mrs Jones you can have different color paint in the bedroom but that will be an extra charge" The list goes on and on. Also most new construction in CT is listed at 4%. That means 1% each to the listing agent, the listing broker, the selling agent and the selling broker (granted one person can play more than role). If you are very lucky, you'll get .5%

If you're buying from a big builder though, all of that work is done by the builder's salespeople, not by your realtor.

Edit - I see that you said SELLING agent, so I do agree with you. But I don't think the people who are offering rebates to the customers are the selling agents...I think that's the buyers' agents who are giving rebates (and not doing much work).

[pshonore]

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

Obviously you've never been a selling agent for new construction. When the contract is signed is when the work starts. "Hi Mrs Jones - the builder wants to know if you want a raised hearth with the fireplace or one on the floor? A few weeks later - "Have you picked out your carpet yet? They would like to install next week" - "Yes Mrs Jones you can have different color paint in the bedroom but that will be an extra charge" The list goes on and on. Also most new construction in CT is listed at 4%. That means 1% each to the listing agent, the listing broker, the selling agent and the selling broker (granted one person can play more than role). If you are very lucky, you'll get .5%

If you're buying from a big builder though, all of that work is done by the builder's salespeople, not by your realtor.

Do you really think I want the builders agent or the listing agent talking to my customer??

[BruDude]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Zero because it's illegal with insurance. If someone wanted to buy a policy from me that pays $15k commission on the agreement that I give half of it back to them and it was an easy case with minimal work, sure I'd love to do that. I don't make the rules, I just play the game with the rules as they are allowed. No different than using tax laws to your advantage.

[BruDude]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

Most builders won't lower the sale price a penny because it affects their comps

My neighbor said he told the builder if he didn't provide a credit to the base price, then he would bring in an agent and the builder could then pay the 3 - 3.5% commission to them.

Sounds similar to getting an agent and then getting a rebate except your skipping the second agent.

Most builders will do anything they can do avoid dropping the price of the house, they would rather provide an options credit ot closing costs credit because that isn't public info and won't affect the comps. It doesn't look good for a builder to be dropping house prices and if you were someone else in the neighborhood that paid full base price you'd probably be annoyed that someone else got a lower comp even though the end result was the same.

[Broken Man 1999]

My builder had his own sale staff & selling agents which he paid 3 - 3.5% of the contract price.

I walked in with no agent and started with the base house price. I didn't think about negotiating.

The neighbor walked in and said, since he didn't bring in an anent, lower the base price by 3 - 3.5% since the builder only has to pay his sale staff. The builder balked at first but finally agreed.

The assessment on the house was based on the contract amounts. All add-ons after the contract was signed were not part of the contract amount. My neighbor had the same house but was assessed for $20k less saving thousands in property taxes. Leason learned; If you put up-grades (refrigerators, stove, dishwasher) into the contract, you'll pay property taxes on those up-grades for years to come. Put those items on the side sheet.

Most builders won't lower the sale price a penny because it affects their comps

My neighbor said he told the builder if he didn't provide a credit to the base price, then he would bring in an agent and the builder could then pay the 3 - 3.5% commission to them.

Sounds similar to getting an agent and then getting a rebate except your skipping the second agent.

Most builders will do anything they can do avoid dropping the price of the house, they would rather provide an options credit ot closing costs credit because that isn't public info and won't affect the comps. It doesn't look good for a builder to be dropping house prices and if you were someone else in the neighborhood that paid full base price you'd probably be annoyed that someone else got a lower comp even though the end result was the same.

A daughter actually got a rebate a short time AFTER her closing as the real estate market was starting to crumble. Sometimes you luck into situations and if your builder wants to have a good reputation, they do their best to ensure the future and past buyers are happy. I had never heard of such a thing, but it happened.

Broken Man 1999

[InvisibleAerobar]

another follow up,

a) how do I find out about these new constructions? I find what I could from redfin/zillow, but i'd presume there may be another way?

b) some of the new constructions i find already have an agent attached (though I don't think they've actually broken ground). With whom am I actually negotiating? The builder or the builder's agent?

[rashad3000]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

I'm a part-time Realtor and you are absolutely correct. I even have an ad letting people know that they should not walk into a builder without seeing me. I will gladly rebate 1% commission on a new build. Why would someone pay $300,000 with no rebate when they can pay $300,000 with a $3000 rebate?

[FlyAF]

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

I'm a part-time Realtor and you are absolutely correct. I even have an ad letting people know that they should not walk into a builder without seeing me. I will gladly rebate 1% commission on a new build. Why would someone pay $300,000 with no rebate when they can pay $300,000 with a $3000 rebate?

Actually, it is more like pay 300k and get no rebate or pay 309k and get a 3k rebate. Hard pass. Don't think for a minute that the builder is just going to eat that when they have their own sales force.

[BruDude]

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Because the realtors know that when they "sell" a new construction home, they don't actually have to do much of anything. They collect part of the 3% and rebate some to the customer. It's no skin off their nose...whatever piece they keep is basically found money.

I'm a part-time Realtor and you are absolutely correct. I even have an ad letting people know that they should not walk into a builder without seeing me. I will gladly rebate 1% commission on a new build. Why would someone pay $300,000 with no rebate when they can pay $300,000 with a $3000 rebate?

Actually, it is more like pay 300k and get no rebate or pay 309k and get a 3k rebate. Hard pass. Don't think for a minute that the builder is just going to eat that when they have their own sales force.

Huh? The price is the price. Maybe it's a regional thing but builders here don't negotiate pricing at all unless they are desperate to sell the last house in a subdivision or something, but the real estate market is so hot that this doesn't really happen. They will sometimes negotiate closing costs or options, but not the sales price. If there's no buyers agent, the selling agent gets the full commission instead of half of it. They don't just raise the price because you have a buyer's agent...

[Theseus]

Once I had decided that I was buying from a builder I cut a deal with a buyers agent to give me the rebate of 2% out of total 3% she got. All she had to do was to show up for the contract signing. It worked great for us. Based on my experience several of my friends did the same thing.

Not all agents are willing to give 2/3 of the commission. But if there is no work involved they may consider it.

[pshonore]

This all depends on whether the builder has employees who assist with sales or lists his houses on MLS through a Realtor. The latter is not much different than buying any other house old or new. In the former, I doubt the builder will be paying to pay an outside agent. And where I live, new construction was always 4%, not 6% if listed in MLS..

[rashad3000]

Once I had decided that I was buying from a builder I cut a deal with a buyers agent to give me the rebate of 2% out of total 3% she got. All she had to do was to show up for the contract signing. It worked great for us. Based on my experience several of my friends did the same thing.

Not all agents are willing to give 2/3 of the commission. But if there is no work involved they may consider it.

I'd do this deal in a heartbeat. 1% of something is better than 3% of nothing.

[bberris]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

[Theseus]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

This is not true. At least not true in my case. Price remained the same for us. I just ended up getting back 2% of the total price (excluding options). I know this because we had priced out the house with all the options. And then I found a realtor the night before we signed the contract with the builder.

[AerialWombat]

My most recent acquisition was new construction. I used a buyers agent that sells more of this particular builder’s homes than anybody outside of their employee sales reps. Because of this, he has a fair amount of “pull” with the builder, in terms of getting them to make certain things right. He was worth every penny that I didn’t have to pay him when some issues came up.

Builder prices are builder prices. Your buyer agent doesn’t increase the price you pay.

Lastly, understand that the purchase contract is most likely NOT the standard, state approved form. It’s a very different, heavily lopsided purchase contract, and it’s not in your favor. Lawyer up, as already suggested.

[WolfgangPauli]

My recommendation more than a realtor is get a lawyer! Builders are a different breed and lawyers can prevent a lot of pitfalls. I bought from two builders and both times my lawyer was the person who really made a difference. For example, before we closed on the house my lawyer made him bring a legal document from every sub relieving me of any and all potential liens / disputes etc. Many do not know this but let's say the builder subs to an electrician. Later, even after you close, the builder never pays the electrician at all or pays the wrong rate. The electrician, a person you likely never met or talked to, can put a lien on your house!

This is one of many things the lawyer will help with. If you know the area and do not need a realtor to help with location, schools, reputation of builder etc then I would skip the realtor, negotiate a lower price and hire a lawyer!

[BruDude]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

No they don’t, I’ve never heard of that. It seems consumer protection laws would prohibit them from doing it.

[jbmitt]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

Not unless the builder has, or intends to list the property with an agent and put it in MLS. He may have his own captive sales force. And an agent who routinely gives up 50% of their commission will not have a very long career. I won't even mention the extra work required for new construction

When I bought my house I got 50% back from the agent. When my parents bought their house from a builder, they got 50% back too. It's not hard to find an agent willing to give up part of a buyer's agent commission. I even found this on google just now - https://shopprop.com/commission-rebates/

I'm not trying to be funny but as an insurance agent, how many times have you rebated 50% of commission on insurance polices? Why should realtors?

Zero because it's illegal with insurance. If someone wanted to buy a policy from me that pays $15k commission on the agreement that I give half of it back to them and it was an easy case with minimal work, sure I'd love to do that. I don't make the rules, I just play the game with the rules as they are allowed. No different than using tax laws to your advantage.

This is mostly true. The exception is licensed agents can split a commission. I’ve been rebated, but I hold a p&c license.

[bberris]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

No they don’t, I’ve never heard of that. It seems consumer protection laws would prohibit them from doing it.

I haven't looked it up, but I seriously doubt there are laws prohibiting negotiated prices for real estate. A builder doesn't explicitly charge for a real estate commission, but you have more leverage if he doesn't have to pay it. All he cares about is the after sale net.

[sunny_socal]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

This is true. The agent's commission is braked into the home price.

Ask the builder to give that commission to you. If there is no realtor in the room the sales rep will be very open about pricing.

[8foot7]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

This is true. The agent's commission is braked into the home price.

Ask the builder to give that commission to you. If there is no realtor in the room the sales rep will be very open about pricing.

Again, In most cases, builders won't reduce the price but they will certainly add allowances. As I and others have said repeatedly in this thread, most large builders are not willing to play the reduce-the-price-by-the-commission game, but there are ways to do much the same thing when it comes to upgrades and structural options. A mom and pop builder may be different, but probably not--most small builders around here are represented exclusively by an independent realtor who grabs the 6% right off the bat and isn't willing to split the other half with anyone else but a licensed buyer agent. Which points again to the recommendation of getting a rebating buyer agent if you're in a state that allows it.

[BruDude]

A lot of buyers agents will rebate you 25-50% of their commission on a purchase from a builder. That alone is reason enough to use one.

The builder will add the agent's commission to the price. You are paying for nothing.

No they don’t, I’ve never heard of that. It seems consumer protection laws would prohibit them from doing it.

I haven't looked it up, but I seriously doubt there are laws prohibiting negotiated prices for real estate. A builder doesn't explicitly charge for a real estate commission, but you have more leverage if he doesn't have to pay it. All he cares about is the after sale net.

The builder has a set commission to be paid on the sale. If there is no buyer's agent, the listing/selling agent gets the entire commission. If there is a buyer's agent, the selling agent and buyer's agent split the commission. The amount does not change. Ever noticed how happy the selling agents are to talk with you when you have no buyer's agent, then a little less enthusiastic when you tell them you have an agent? That's why.