Many buyers ask this same question. They think that, “If I’m buying a new house directly from a builder, why do I need a realtor?” After all, you can find a builder, drive right up, negotiate the deal and move in all your own right? Sort of. The bottom line is that hiring a realtor means you have someone in your corner. Someone that is looking out for your best interests. And if that isn’t enough here are a few more reasons to hire a realtor when working with a builder.
Have you ever visited a model home? The representative there probably sounded like a real estate agent there to help you. However, the builder representative is a salesperson for the builder. They are looking out for the best interests of the builder. Also builders’ representatives are not usually licensed real estate professionals. As such they aren’t bound by the same laws and professional ethics that realtors are.
Can a buyer negotiate effectively? Yes of course they can, especially if they have insider knowledge about what incentives are typical. It’s also beneficial if they know how to compare alternative financing, who pays for title costs, appraisals, inspections, warranties, surveys, etc., what upgrades cost and how to apply builder concessions. But if you’re a buyer that is unsure of any of these items a realtor can help you ask the right questions during the negotiation process.
Realtors encourage and insist that their clients obtain the proper inspections. The number and severity of new home defects easily rival that of resale home problems. The builder’s representative is not likely to recommend that the buyer get a home inspection and many buyers believe that the new home warranty will take care of their problems. This reason alone justifies hiring a realtor and obtaining all necessary inspections as the warranty does not cover everything.
Many buyers also are unaware that the commission for buyer representation is legally part of the purchase price. Basically, if you’re not using your own realtor the builder receives an extra three percent from your purchase. Therefore, it’s free to use to a realtor when working with a builder so what are you waiting for?