Home Buying in Rochester>Question Details

Tim, Home Buyer in Rochester, NY

How do I negoiate with a custom home builder?

Asked by Tim, Rochester, NY Wed Oct 7, 2009

We are planning to build a house on property that we already own. We have provided three prospective builders with our plans and received the initial quotes. We have reviewed the quotes and made some changes in order to get the price closer to what we intended on spending. The amended quotes are still not in line with what we want to spend. We believe that we have made all of the changes that we want to concede at this time. We want to make this as much of a win-win situation as possible but we are not exactly sure on how to proceed at this point. We have searched this topic on line but cannot find anything that speaks specifically to the topic

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Bob Kirby’s answer
The problem with new consturction is the builder has fixed cost for the marterials to build your home. The builder's supplier's and sub's have a cost. In todays market , they are most likely working at the least that they a willing to do the job for a rock bottom price.You have three builders fighting for the job. If it could be done for less one of them would have come forward. Make sure that the builder you choose didn't make a mistake and can really finish the home at the price. Builder have been known to walk from jobs after receiving draws. It sounds like you need to spend a little more than you expected or compremise on the materials. Please don't ask the builder to leave every other nail or 2x4 out .Just a joke to drivre home the point. Interest rates are at, or near a 40 year low. Finance more and tighten your belt elsewhere for now. Build the most you can now so you will not regret later. Remember building is very trying. Don't let it interfere with the WE above. Bobkirbysells.com 585-719-3540
0 votes Thank Flag Link Wed Oct 7, 2009
You should have professional representation as a buyer when building a home with a builder. Negotiating directly with a builder puts you at a huge disadvantage when compared to using a REALTOR. I have represented many clients building homes, and they have always come out ahead when compared to those that choose to work solely with the builder. There are many ways to negotiate in a build situation. To preserve neighborhood values, builders will typically not discount the price beyond a certain amount, at that point negotiations switch to including free upgrades. If you think you can do as good a job as a professional, I strongly urge you to call me for a free consult. We have experience working with these builders and know what is customary in both price per sq ft per specific location, cost of improvements, and when it is best to have the builder not provide the upgrades. There are many tips and techniques I employ when working with builders, and you must be prepared strategically from the very first interaction. It is a very complex negotiation for new build and you need to be prepared before making that first call to the builder.
0 votes Thank Flag Link Fri Nov 28, 2014
I am planning on building my own home soon. I want to find a custom home builder to work with. Were you able to find out how to do this. I want to make sure I work well with the home builder and end up paying the right price for my home. http://www.randyjeffcoatbuilders.com
0 votes Thank Flag Link Tue Nov 18, 2014
You're not likely to be able to negotiate a lot "price-wise". I've often been more successful in negotiating better materials, or moderate upgrades. Much of the builder's cost are fixed in terms of labor, material, and carrying expenses. They maybe more apt to shop around and get a better price on material upgrades that they are to discount the up-front price of the home.
0 votes Thank Flag Link Wed Oct 7, 2009
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