One topic that has always provided a huge amount of confusion is the relationship between builders, agents, and buyers.  It often brings up many questions and most of them are just misunderstood.  So we figured we would provide a look into all of the facts and insight around using an agent or not when building and what the best move is for you and your family if you’re going through that process.

Common Misnomers:

1. Builders Don’t Work With Agents:

Builders are members of the real estate community just as much as agents and brokers are.  So with that, there is a strong working relationship between all, one that certainly doesn’t exclude one another from working together and bringing each other clients.  If you really think about it, from a builder perspective, it wouldn’t make any sense at all to shut out agents.  Agents are after all the ones that develop relationships with clients and builders certainly would want to be at the top of the list when buyers come to those agents looking for a well respected and high quality builder to use.

2. If The Buyer Does Use An Agent, The Price Of The House Gets Increased By The Amount Of The Commission:

From a valuation perspective, building a brand new house is no different then purchasing an existing home.  The price of the house is the price of the house whether an agent is involved or not.  You could take the same example to a home owner that chooses to sell their home on their own as a for sale by owner.  They price the home what they think it’s worth in the marketplace.  If they can’t sell it on their own, it wouldn’t make any sense to hire an agent and increase the list price by their commission, or if they do, they’ll simply out price the market place and the home will never sell.  Brokerage fees are simply a cost for a value gained.  The value gained from a builder to pay an agent is that relationship.  Having an agent bring them a new client and providing compensation for that.

Why Would A Buyer Need To Use An Agent To Build?

Technically speaking, buyers and sellers would never need agents, to build, buy, or sell.  This question always comes down to need and value, plain and simple.  You could ask it in a different way as well by saying, if you’re selling your house, do you need an agent to represent you?  Of course not, you can sell whenever you’d like, but you choose to list with an agent because of the specific value they bring with that service.  Hiring an agent to help you with your new home build is no different.  So what sort of value are we talking about?  Well really the exact same value we’d provide if you were looking to buy an existing property.  Utilizing someone to help you understand the market place, neighborhoods and the value those bring, what sort of property you should build based on neighborhood and development, comparing builders and their products for your value, ext.  All of this comes back to your need and value.  If you don’t have the insight, time, and knowledge for any of these examples, then you probably want to utilize a buyer agent to help you.

Other Building Options?

As most people aren’t aware, as someone looking to build, you have a lot of different options at your disposal that you might not know about.  Of course your classic sense of building is finding a development, contacting a builder or agent, and starting the process.  So what other options are we talking about?  Well for one, there are many different places that you have the opportunity to build and develop on.  Yes newer developments are the most well known, but there are typically lots all over the community that are also available to build on, you just need to speak with an agent that knows where they are.  There are tons of developed neighborhoods where vacant and empty lots exist just waiting to be built on.  These examples could be double lots, damaged/torn down houses, or simply lots that never got developed on  for whatever reason and are now sitting available.  So maybe you want the best of both worlds with a brand new house and an established neighborhood?  It can be done.

Chances are if you’re looking into building, it’s because you want to have something new, and also something that you pick out and design yourself so it’s exactly the way you want it.  So what about remodeling?  Our sister company Green Acre Construction specializes in existing home renovations that focus on not only what you need as owners but also what your house needs as an investment.  Or what about remodeling a new house you find listed somewhere?  Often times you can get a lot more bang for your buck by remodeling dollar per square foot then building new.  And of course with all of the additional amenities that a developed neighborhood has to offer.  We can facilitate a variety of different options to not only get you into a newly remodeled dream home, but make it so you don’t have to live in the construction zone, and only close on the new house once the work is completed.  No messing around with extra construction loans or temporary to permanent financing.