Let me start by saying that I, personally, have built two houses. Both times, the sales agents for the builder were kind and helpful. I have also helped countless clients with their new construction purchases. I have nothing at all against builder sales agents, in fact, many of them are my friends! What I do have is an understanding of what their job is and agency law. Therefore, I’d love to share my reasons why you ALWAYS want a buyer’s agent, even if it is new construction!

Agency law is the part of real estate that describes who works for whom and who is representing whom. I’m simplifying it, but agency law directs us as agents as to whose best interests we represent. When you “hire” me as your buyer’s agent, you do so by signing a buyer agency agreement. I put “hire” in quotes because buyer’s agents’ commissions are typically paid by the seller, or in this case the builder. This agreement puts me to work for you officially and describes all of the duties I owe to you, my buyer. Once you’re my client, I will then probably learn details about your timeline, your motivation to buy, your personal situation and maybe even your finances. These things could be key factors in negotiations to purchase a home, and as your buyer’s agent, I owe you confidentiality, care and loyalty, among other things.

I don’t want to bore you with agency law 101, I just want you to first and foremost understand what it means to have a buyer’s agent. Now, I want you to understand the role of a builder’s agent. They work for the builder. Their client is the builder. They represent the seller, not you. They are not legally bound to represent your best interests at all. Therefore if you walk into the sales office and share your situation and your personal details, they will certainly take those things into account when trying to sell you a home on behalf of the builder. They can certainly assist you in choosing the home, learning about the building process, guide you through the transaction and explain the paperwork. In fact, they are experts about their product and a completely invaluable resource. However, they don’t work for you! That doesn’t mean they’re out to get you. Quite the opposite, if you are happy and your house is built and your transaction closes, then they are happy. That’s when their client, the builder, is happy, and that’s when they get paid! Please don’t misinterpret this to think the sales agents are the bad guys. They are not! But they do have a job to do and that’s to sell houses for their builder. They should be and usually are totally helpful and kind and pleasant to work with. Please don’t neglect the very important detail that the builder sales agent never represents you!

Could you purchase a new home without a buyer’s agent and get through it just fine? It’s absolutely possible. But why would you want to go into a life-changing financial decision and make a major investment without representation of your own? Why wouldn’t you want an expert on the process to read the contract on your behalf, to tell you what’s normal and what’s not throughout the process, to anticipate bumps in the road, and to answer your questions? To me, having no buyer’s agent is like stepping into a court room and representing yourself without an attorney. Sure, you can do it and you might even win the case. But why would you turn down the chance to have someone acting on your behalf?

Like many things in life, you don’t know you need a buyer’s agent in new construction until you actually need that buyer’s agent. If there is anything tricky or something goes sideways or you are unhappy, then you are going to want representation. In any of those unfortunate circumstances, you would be wildly unhappy if the only person you had was an employee who actually worked for the company you were upset with.

As buyer’s agents, we have a lot of experience with builder’s contracts. Important to note, builders do not typically use the standard state forms. They draft their own. Therefore, when you sign a contract to build a new home, you are using the contract drafted by their attorneys. Whose best interest do you think the contract protects? You got it – the builder. Now, does having a buyer’s agent mean you can get them to sign off on some changes to that contract to better represent your interests? Probably not. But having a buyer’s agent will give you someone with experience to know what is typical in these contracts and what to look out for.

Situations could arise which aren’t specifically addressed in the contract. For example, I had clients building a home when the soil was determined to be unstable. The builder wanted them to pay $25,000 after contract signing to remedy the soil issue and continue building. I have seen other builder contracts which address this exact situation. This contract, however, did not. As the buyer’s agent, I worked with the sales team and their legal counsel and eventually we determined that it was outside of the contract and the buyers were not obligated to pay this fee. Thankfully, we got the builder to cover the entire amount and move forward with the build. Imagine finding yourself in the shoes of those buyers if you had no agent. Being asked to cough up an extra $25,000 is kind of a big deal. Representation matters.

I’ve never encountered a builder rep who didn’t welcome my presence as a buyer’s agent. They don’t see us as the bad guy either. In fact, I think they like us. We are an intermediary that usually helps keep the process and communication fluid. I believe it is an urban legend that you can get the house cheaper if you don’t bring an agent. The builder pays the buyer’s agent commission, not the buyer. So yes, there is a cost to the builder. I’ve been told time and time again that the buyer’s agent commissions are worked into the pricing of the home and they will not come off of price if you show up agent-less. Please beware of any builder sales agent that asks you to ditch your agent or tries to convince you that you’ll get a better deal. Just think about that for a second. They are trying to talk you out of bringing in an expert to represent you. Does that sound like someone you want to work with and trust with an investment of this size?

I love new construction and I especially love helping clients with the building process. Few things are as exciting as watching a house go up, board by board. If you are interested in new construction, consider finding a buyer’s agent you trust that loves new construction like I do. If you decide to pop in some model homes on your own, be sure to share the name of your agent with the sales rep so that down the road when it’s time to go to contract, there’s no question whether or not you have representation. Let your agent focus on the contract and guide you through the transaction so you can focus on the important stuff, like granite selections and the perfect backsplash to match.