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Jon, Other/Just Looking in 48198

Should I get a buyer's agent if I'm looking into new homes or just have an attourney check the paperwork?

Asked by Jon, 48198 Wed May 28, 2008

I'm still in the early stages of looking for my first home - checking out different areas and viewing some open houses to get an idea of things. I think it would be a good idea to get a buyer's agent if I consider older homes, but what are the reasons and benefits of having a buyer's agent if I decide to go with new construction developments? Will all developers work with buyers agents? Do buyers agents regularily assist purchasers of new homes?

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In working with buyers purchasing new homes, I've found I've been able to help them negotiate price and walk them through the loan and closing processes. As an example, inspections on new developments are not always as complete as they should be. An independent inspection, which you might not know to do without outside advice, can turn up hidden items that you might not know about otherwise. I've seen wrong addresses in closing papers and mistakes in loan documents that would otherwise not have been caught. An attorney may not be as well versed with the various local real estate disclosures and forms that are required as your local realtor would be. By the way, any realtor can represent you as the buyer although what's customary where you live may differ.
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1 vote Thank Flag Link Wed May 28, 2008
BUying from a builder is like buying from a for sale by owner. The builder has just one "product" to sell so is definitely pushing to sell it for his/her best interest. The value of an agent is that they can show you all of the market, re-sale as well as new construction. Comparison shopping makes you an informed buyer whether comparing builders or comparing what you get for your money between existing homes (re-sale) and new homes. A buyers agent will also suggest a home inspection to get a third, professional opinion on the quality and detailing of the finished product. A punch list from an inspector will help catch the oversights of the builders. Most builders have their own contracts so an attorney review is very important. Good luck and happy buying.
1 vote Thank Flag Link Wed May 28, 2008
Jon,

P.S. On average, builders/developers plan for 70% of their homes to be sold to a home buyer who has representation through a buyer's agent/realtor. But they clearly hope that you come by yourself, not simply because they don't have to pay the buyer agent commission, which they will pocket, but because they know you are at a disadvantage.

Think of it this way, if you went to purchase a car from a dealership and you could take someone with you who's likely purchased hundreds of cars, knows the market and all the angles, and knows how to work the system to your advantage, and you could do this with essentially no direct cost to you, would you pass on the opportunity?

Again, good luck!

Jeffrey
1 vote Thank Flag Link Wed May 28, 2008
Jon,

Actually, the transaction where you will need a buyer's agent the most, is the transaction where the person selling the home has the most information, and you have the least information. Oddly, this occurs most often in a new home purchase. Builders/developers hold all the cards, AND, often will submit terms to you that lock you into not only the home they are trying to sell you, but also tie you into their mortgage company, their title company, their insurance company, and anything else that can make money off of you.

A good buyer's agent is going to be able to cut through all the junk and negotiate your best deal. Especially one who has experience in the area you're interested in, and one that has experience in negotiating on new homes.

Don't for a minute think that a new home purchase is the opportunity to do this yourself, you will get s_____d in the process.

Regards,

Jeffrey
1 vote Thank Flag Link Wed May 28, 2008
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