Do I need a realtor if I’m buying new construction?

November 11, 2021

San Francisco has a number of new housing developments such as 960 Market St or The Avery at 488 Folsom to name a couple. Real estate agent Judy Lin, was recently confronted by a colleague who expressed interest in purchasing a brand new condo and believed she would save money and get the best representation by purchasing through the builder’s sales office. 

This begs the question: Do I need a realtor if I’m buying new construction?

The short answer is “yes”. Here are 5 reasons why.

1. Best Representation

The real estate agent and sales office are in place to represent the builder’s interest, not yours.
An independent agent represents your interests and will advocate on your behalf. Additionally, an independent real estate agent will help you get the most value for the least amount of money and will take the time to review the disclosures and educate you on the purchase and process.

2. Builder List Prices

You are not going to get a discount on the list price. No surprise here but there is often a misconception that a deal is in the works if you go in un-represented. A drop in price would affect all preceding building sales. It is a possibility that the builders may pay for some closing costs or offer design center incentives. More often than not, the builder’s agent or the builder will pocket the money.

3. The Builder Pays the Agent Fees

Buyers do not pay the real estate agent fees, the seller or in this case, the builder does. Builders view commissions to real estate agents as an integral part of the cost of doing business without which they would not find buyers. Builders will not credit buyers the commission they would otherwise pay to a Realtor. If they were to do so, realtors would no longer bring clients through the builder’s doors and ultimately it would impact future sales. Therefore, there is no downside and no cost on your end to have an outside agent represent you.

4. What You See Is Not Always What You Get

With new construction, it is important to understand what you are purchasing. The model home you saw may not be a good representation of what comes standard with a home. A realtor will help navigate this for you. When touring a model home, it’s important to find out what options are standard, what options are available, and what additional options will cost!

5. Don’t Go Alone

It is common for unrepresented buyers to be asked to register with the builder’s sales office and in doing so can forfeit their opportunity to have their own representation. A good buyer’s agent will understand what items are negotiable and will always put your best foot forward without emotional involvement.

As a trusted agent, we put your interests first. Talk to us today about what you are looking for and how we can help make that happen.

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