Building New: Should you use a Real Estate Agent?

So many factors weigh into the decision to build new vs. purchase an existing home, and those factors are different for every family. We remodeled our last home, and while it was worth the financial investment, we decided that this season of life wasn’t the right time for new projects. We spent a few months considering all of our options, and ultimately decided to build new.

As we began the process of building a new home, we struggled to find a great source of information with all the little tips, tricks, and checklists to help us make decisions. We relied on friends who’d previously built with a variety of other builders, and most heavily on our Realtor. I’m working on a series of blog posts that will cover the things we learned, from how/why we chose to work with a Realtor, to which upgrades we skipped and how we DIY’d them ourselves.

Should you use a Real Estate Agent when building new construction?

We were unsure about using a real estate agent when we chose to build – it seemed like a pretty well-defined process, and we didn’t want to spend even more money for something we could manage ourselves. A friend who’d built mentioned that their agent guaranteed to save them more than they paid in fees, and that felt like a fair arrangement to us, so we explored it. When we approached our real estate agent about listing our home for sale, we also asked him to explain how he could help in the new construction process.

Based on our own experience, we’d recommend using a real estate agent! Here’s how we felt it helped us through the process:

  • We received a reduction in our selling fees when we agreed to use the brokerage to both sell our old home and buy our new home. It saved us approximately 1% on our selling fees.
  • In most cases, the buyer doesn’t pay the agents’ fees; in our case, the Builder (seller) paid our agent’s fees – so even if we hadn’t gotten a discount on selling, we wouldn’t have paid anything to have an agent represent us.
  • We chose to build with a national builder (think housing development vs. purchasing a lot and hiring someone local), and the contracts are a lot more stringent with this type of builder. Our agent helped us navigate the fine print, and understand what was “typical” and negotiable, vs. what wasn’t.
  • Home building (maybe even more so than buying) can be an emotional experience. No schedules are guaranteed, and there are a lot of decisions to be made. Our agent was basically a counselor; he helped us gut-check when we were felt we might be over-reacting on issues, and helped us figure out how to approach rationalizing & cutting some upgrades to stay on budget (and stay married).

We quickly realized as we worked through the building process, the sales team in the model home isn’t there to represent your best interests; they are paid by the Builder to get you to sign on the dotted line. More about that later.

Our real estate agent isn’t paying us to say any of this, but both Chad and I have agreed that we may not have survived the process without Josh on our side. When we did have emotional reactions to delays, poor quality work, and missed commitments from the builder, Josh was able to help navigate how to approach the builder and make the issues ultimately work in our favor.

Questions to ask when hiring a Real Estate Agent for a new construction home

We’d already signed with our agent to sell our old home, but after a meeting in his office where he shared his experience with new construction build process both in our area, and with builders of the type & size we were considering, we felt comfortable moving forward. Here are some starting questions as you meet with a real estate agent:

  • Are you familiar with the new construction process?
  • How many new construction home sales have you brokered?
  • What is your experience with the specific builders we’re considering, or builders in our target area?
  • Are you familiar with the type of build we plan? Example: large, national builder in a development vs. purchasing a lot and building with a small custom builder.
  • What is the value you can add to our home building experience?
  • Can you help us save money or time in the new home building process?

If you think you might consider using a real estate agent for the new construction process, you should research and select an agent before visiting models and sharing your contact information. If you begin to work with the builder prior to announcing your real estate agent to them, it could cause contractual issues.

There are approximately 12,397 more decisions to make during the new home construction process, and I’m working on a number of additional blog posts to share our building journey. Up next: Decisions 2 – 37: National Builder vs. Complete Custom Build.

If you’ve read this far, while I didn’t put this guide together to be a plug for our agent, he probably deserves a shout-out for being the most patient, professional, and reliable agent we’ve had (and we’ve had a few). If you’re in the market for a real estate agent, Josh Champ is our guy: https://www.pomerleauteam.com/team/josh-champ/

Have you built a home? Did you use a real estate agent? I’d love if you’d share any additional tips or questions in the comments!

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