Do I need a Realtor for a new builder home? (Howe: sales, real estate)

[pauljadam]

I've looked at a few so far without a Realtor (still have not hired one yet) and of course the sales agent said I did not need one since I've purchased 2 homes already.

Is a real estate agent going to help me get a better deal on a new builder home? I know the commission is built into the cost of the home by the builder.

So who gets the commission if I don't have an agent? The builder's sales rep? Can a builder give me a better deal if I don't have an agent? Or is that even allowed?

I understand I can get a better deal on a already built home that has not been sold like cheaper price, free washer/dryer/fridge, etc. Are there any deals possible on new homes that have not been built yet?

I already know the general location we want to live and have the ability to do fairly in-depth real estate research. But I'm curious if I should just go at this alone if we're set on a builder home or what a Realtor can really do for me?

I know if I'm getting a re-sale then an Agent is the only way to go but we're heavily leaning towards a builder home and I know re-sale inventory is low right now.

[llkltk]

We used a realtor on a new construction because we were selling a home. We only had to pay 3% instead of the typical 6% since the builder paid our agent's 3%. It was worth it if you are selling a home.

[pauljadam]

That's a good point. But no my last home is already sold and we've been renting for the last 2.5 years or so.

[IC_deLight]

Originally Posted by pauljadam

I've looked at a few so far without a Realtor (still have not hired one yet) and of course the sales agent said I did not need one since I've purchased 2 homes already.

Is a real estate agent going to help me get a better deal on a new builder home? I know the commission is built into the cost of the home by the builder.

So who gets the commission if I don't have an agent? The builder's sales rep? Can a builder give me a better deal if I don't have an agent? Or is that even allowed?

I understand I can get a better deal on a already built home that has not been sold like cheaper price, free washer/dryer/fridge, etc. Are there any deals possible on new homes that have not been built yet?

I already know the general location we want to live and have the ability to do fairly in-depth real estate research. But I'm curious if I should just go at this alone if we're set on a builder home or what a Realtor can really do for me?

I know if I'm getting a re-sale then an Agent is the only way to go but we're heavily leaning towards a builder home and I know re-sale inventory is low right now.

Before buying a "new home" in any of these subdivisions you should consider legal counsel rather than just a real estate agent. Sure a real estate agent will help "close the deal" but are they really representing you as a buyer?

All too often a buyer will focus solely on what they see without regard to the invisible legal entanglement that comes with it due to the almost certain HOA corporation that virtually all new homes are burdened with.

Does the developer/builder control the HOA corporation? Are the homeowners the sole mandatory funders of the HOA? Is the board of the HOA permitted to borrow unlimited amounts of money with your home as the security for those loans? Might want to think about whether you are buying a home for yourself or whether you are buying an unlimited obligation to debts that the HOA is going to rack up.

If this is an HO-burdened property you should also demand an estoppel certificate to protect you against future harassment from the HOA corporation for what you are purchasing. Typically such an estoppel is offered by the "resale certificate" component of the response to a request for subdivision information. Builders may balk at any obligation to provide a "resale certificate" by claiming that they don't apply to new homes. This is a trap for buyers who then become easy prey for the HOA management company and affiliated vendors.

The estoppel serves to prevent the HOA (or its agents) from being able to pursue litigation against you for claims or conditions existing on the property as of the date of the certificate that were not listed on the certificate. This includes claims for allegedly past due assessments as well as any breach of restrictive covenant. Without such an estoppel you are a sitting duck for abuse. Abuse definitely occurs and people are forced to incur large legal bills to defend themselves while the HOA attorney and management company clean up financially at the homeowner's expense.

So get competent representation with respect to the house that you see as well as the legal obligations that you can't see in this transaction.

[robino2001]

Our realtor fought for us on a bunch of issues for our build - all of which we were told "tough s***" by the builder initially - all of which went in our favor in the end because of our realtor. So it was more than worth it - especially if there is no cost to you, right? We got a bunch of things they would have never given to us without her.

Now with that said, I BELIEVE once you've communicated with a site agent/builder, if you did not have your realtor present or mentioned that you had one, they don't have to interact with them.

As for your question with cutting a bit of the realtor cost to you instead if you don't have one - I haven't come across any that would do that.

[luckyirish676]

Technically speaking, it is ILLEGAL for a builder to give you any sort of "cut" because a real estate agent did not assist you in the purchase. That being said many builders will find ways to give you in-kind gifts as a result of not having a realtor. I have worked in real estate and in my honest opinion it is not worth the risk to NOT use a realtor. Like the previous poster said, the agent will help you fight the battles that all to often come up with new construction. They will also advise you when certain things are fishy. They can help you negotiate a home warranty, they can "check" on construction for you. Too many people think realtors basically get paid to do very little but if you live with or are related to a realtor you will see HOW MUCH they really do. Besides, consider it a Cover Your Arse (CYA) that you really dont have to pay for.

[Austin97]

Originally Posted by luckyirish676

Technically speaking, it is ILLEGAL for a builder to give you any sort of "cut" because a real estate agent did not assist you in the purchase. That being said many builders will find ways to give you in-kind gifts as a result of not having a realtor. I have worked in real estate and in my honest opinion it is not worth the risk to NOT use a realtor. Like the previous poster said, the agent will help you fight the battles that all to often come up with new construction. They will also advise you when certain things are fishy. They can help you negotiate a home warranty, they can "check" on construction for you. Too many people think realtors basically get paid to do very little but if you live with or are related to a realtor you will see HOW MUCH they really do. Besides, consider it a Cover Your Arse (CYA) that you really dont have to pay for.

why would this be illegal? can you reference an actual law?

[infoseeker2010]

I would say it depends upon the builder you are working with. The builder we bought, would not give any credit as it was against their policy.

I think part of reason for having that policy is they don't wanna alienate realtors as they earn much more through realtor sales than savings on sales without realtor. To realtors they pay 3% and without realtor they have to give deal at least worth 1-2%. So not a big deal compared to numerous deals realtor brings.

Another builder we talked to was willing to offer us $5K credit (irrespective of home price) for not bringing realtor. My friend purchased a new construction from another builder (none of previous two) and he got $3000 credit for not having realtor.

Personally I would rather have realtor. But I see you already have purchased two homes before so you are experienced. For me it was first time. There were couple things for which the builder sort of (not completely) turned his back on us. Our realtor fought for it and at end everything was fine as we wanted. For me there wasn't an option of not having realtor, as builder didn't give credit for not having one. However even if they did, anything less than $5K, I would rather have realtor. If you buy a $250,000 home, $5000 is like 2%. I would prefer mental peace and correctness for such huge investment. If the credit is close to 10K then definitely no realtor

[owlman]

If the builder isn't giving you any cut, you might as well get one of those discount realtors that give you 1% cash back or some sort of incentive.

[infoseeker2010]

Originally Posted by owlman

If the builder isn't giving you any cut, you might as well get one of those discount realtors that give you 1% cash back or some sort of incentive.

i thought that was illegal..