Don Rich

Lets Buy a Brand New House!!!

Have you ever gone into a car dealership and met with the nicest guy that is about to sell you your next new car.  Sure you have!  The salesperson will spend about 2 plus hours with you earning your trust can confidence and then you get down to the bottom line of price.  The salesperson tells you that he is going to fight for you and carries your offer to the sales manager.  He comes back and gives you a counter offer.  If you are real demanding at this point you then give another higher than your first offer and this time the sales manager comes back and says if you would be willing to pay this price I will go to the General Manager or even the owner and see if we can make this work for you.  He does and comes back and says I have great news, I got them to accept your last offer.  The key word being “YOUR”!  Well let’s examine what has actually taken place; 

1.     You have just raised your price at least 2 times.

2.     More than likely the big boss is bringing a offer to the bigger boss that he knows will be accepted because they have already made you move your initial price more than once (that’s how they make money).

3.     You buy the car and feel great because you just negotiated and feel that you got a great deal.  Maybe you did, but maybe you didn’t get the best deal possible.

     When you enter the vast majority of new model homes you are always greeted by a very friendly Builders Representative (A Licensed Real Estate Agent, normally) that works directly for the builder and represents the builders best interests, not yours.  Yes they will be very cordial and friendly and make you think that you are the most important person in the world.  They have a boss, trust me their boss is more important.  Another amazing fact is that the agent is paid by the builder.  What a concept!

     We all know that when you walk into a new model home that their prices are firm and that is what you are going to pay, right!  I’ll address this point later!  I can vividly remember when the latest housing boom took place from early 2004 through Sep 2005 and the builders reduced Real Estate Agents commissions, because they felt they did not need us to sell their homes.  They were right as home buyers were willing to pay high prices on new homes that were seeing home price increases as often as weekly.  Today they again love us Realtors and are offering wild commissions for us to bring in our clients.  Why, because they cannot bring in the volume of business to sustain themselves and need the entire Real Estate communities assistance.  Please do not see this as an attack on new builders or their agents, they have a job to do, and most do it very well.  In this buyers market there are things that are negotiable even though they will not announce this to the public.  Would you go into court on a felony charge without a good lawyer, NO!  You even have to pay the lawyer for his services.  Why would go to buy a new home without professional representation when its readily available and absolutely free of charge to you the buyer.  Yes I am talking about a licensed Real Estate Agent!  Below I will list many of the wonderful things that a licensed Real Estate Agent can do for you when buying your next new home. 

1.     Agents with strong negotiating skills can in this market increase the advertised incentives offered.  Example:  I recently brought a buyer to a new home builder that was offering a 10k builder incentive to be used any way the buyer wanted.  My buyer thought this was great.  I politely asked the builder’s agent to double the incentive or I would take my client elsewhere.  Trust me, builders in todays market will not lose a buyer for 10k.  AT least I have not found one yet.  Other example’s are I’ve seen lot premiums cut in half or even a third.  One builder was offering a pool that was worth 25k.  I stated that my buyer did not want a pool , but if we signed today would you take that off the base price.  The agent said no way!  I politely asked her to call the decision maker.  The answer was yes!

2.     Licensed Real Estate Agents often know how a good home is built.  Why wouldn’t you want a professional with you during the pre-frame walk-through, framing walk-through, pre-drywall walk-through, and pre-close walk-through.  I cannot tell you how often I have found things that the average buyer would not even know to look for.  Things from broken trusses, kinked AC ducts, crossed wiring, and the list goes on from there.

3.     A good Agent will conduct periodic inspections of the homes progress and often forward pictured, especially for out-of-town buyers and in many cases have problems corrected before they get covered up with things like dry-wall.

4.     If you’re selling a home to buy the new home who better to represent you than the same agent.  He/she already knows the complexities involved and because you are doing a multiple deal with the same agent, may even offer you a commission discount further saving you more money.