Why Should I use a Realtor when Buying New?

 Guest post by Andrew Hill @ www.NewHomeSource.com

At a time when cutting back has become the norm, it’s no surprise that many in the process of buying a new home might be asking themselves, “Why do I need a realtor?” This seems a natural question for those interested in buying a new home, while wanting to save all they can. After all, you can talk with the home builder or his agent and quickly be the owner of a brand new home- and you can do it all without ever having to sit down with those money-grubbing realtors. But what you may not realize is that the money you are saving by skipping out on the realtor isn’t really being saved at all. In fact, those who don’t use a realtor are costing themselves more in the long-run. Come again?

That’s right. Whenever you try to save yourself that 3% commission rate, you aren’t cutting the cost of your home at all, because the realtor’s sales commission is taken from the builder’s profit. Furthermore, the seller’s agent has no interest in helping the buyer. His job is to get the best possible deal for the builder, so don’t be fooled by their friendliness, whether well-intentioned or not. The seller will not give you a discount because you aren’t represented by an agent. By going into the transaction unrepresented, the builder is free to either pocket his savings or pay a higher commission to their sales representative.

Now that we’ve debunked the myth that you’ll be coming out ahead by skipping an agent, we’d like to point out all of the benefits that come with being represented in your transaction.

For starters, your agent is a licensed professional, meaning he or she has a wealth of knowledge and resources unavailable to the average home buyer. By hiring a realtor, you also save yourself the time and energy of doing quite a bit of legwork. Many buyers justify not using an agent because they figure they can do this legwork themselves and save some money. Seeing as we just debunked the agent-less money-saving myth, why not save yourself the trouble and let a professional do the legwork? Real estate agents are also your personal advocates. During the process they represent your interests and wants to get you the best deal possible- after all, their jobs and reputation depend on it! In some cases, an experienced agent can even negotiate with the seller’s non-negotiable prices to get you a better deal.

So instead of asking yourself, “Why should I use an agent?” the real question is, “Why wouldn’t you hire an agent?” At no cost to you, hiring an agent will save you time today and money tomorrow.


#1 By John Herrigel at 6/22/2017 4:13 AM

Great post - it is important to know what is really going on with buying your new home, or any major transaction you may make. A buyer's agent will work with you to get the best deal possible, and spare you the extra headaches!

#2 By Debbie Gartner at 6/22/2017 4:13 AM

This is a great post. EVERYONE needs an advocate and learning from a less biased perspective is critical. A Realtor will help you understand the difference between buying new and its advantages vs. buying an existing house and why that might have more value. This is not a case of penny wise, it's a case of being uninformed about where the commission comes from and understanding the value of a Realtor.

#3 By Eric at 6/22/2017 4:13 AM

Every buyer should read a post like this before they even think about real estate. Its amazing to see how many people actually still do not know that the BUYER SERVICES ARE 100% FREE to them. A real estate agent has a moral obligation to look out for your best interests.


#4 By S George at 6/22/2017 4:13 AM

Its a bit rich for a Real Estate agent to tell buyers not to be fooled by friendliness of the builders agent! It undermines the whole post.

#5 By James at 6/22/2017 4:13 AM

No cost to you if you hire an agent, this is certainly not the case in England as here a property agent takes 2% at least of what it is worth meaning that if your property is worth say 300,000 then thats a lot of money and if it was me I would rather not give them this much money I would rather sell it myself.

#6 By Brian at 6/22/2017 4:13 AM

Well said. I wish there was a way to get the word out to all buyers that the developer's rep has no fiduciary duty to the buyers... they are contractually obligated to look out only for the developer's best interest! Maybe we should make it mandatory that they disclose that in plain language to buyers as soon as they start working with them. Instead they typically do the opposite and say things like "Let's see if we can get the developer to negotiate on that" which really leads the buyer into thinking that they're working with an agent of their own.

#7 By Molly at 6/22/2017 4:13 AM

I would have to say that no matter what the case is, when buying a new home, it's crucial to use a realtor. They are there to help with all aspects of buying a home, and even when buying new, there's paperwork and other things that need to be taken care of to protect the buyer. I work in the Denver Housing market, and I help people buy new homes quite often. I find that my clientele is satisfied no matter what.

#8 By Tom at 6/22/2017 4:13 AM

Hi Ryan,
Thank you for stating the importance of the subject. So many times I have encountered the client that thought that representation would actually increase the home price due to a commission paid. After a conversation with quite a few of these folks you certainly can explain the benefits of the buyer agent relationship and in all instances get them a better price on the property. While there are numerous folks that still walk in without representation it is a shame as it is no different than representing yourself in court. very nice post!

#9 By Ghayoor Shaikh at 6/22/2017 4:13 AM

Thanks for great knowledge,
I am agree with your points that if someone escapes Realtor involvement in the dealing he will suffer a lot. Due to purchaser's incompatibility of ideas and knowledge and along with experience.
Secondly, by hiring a real expert or professional you save money and property in a wider spectrum.

#10 By Dan Krell at 6/22/2017 4:13 AM

As new homes are currently filling the void that low re-sale inventory is leaving, don't leave your agent behind. Many agents are aware of builder incentives and close outs. Good agents follow and track the building process with the buyer to facilitate a positive outcome/experience and ensure there are no surprises.

#11 By Steve at 6/22/2017 4:13 AM

Hi Ryan, isn't it the case that all house-buyers should be using Realtors? if one cannot really buy a car without expert help, how can anyone really finish off a deal for the largest purchase of their lives? Similarly with my business at http://www.rickshow.com everyone thinks they can do it, but not many can!
Completing a deal will certainly change their minds.

#12 By Dennis at 6/22/2017 4:13 AM

I strongly agree with the idea of engaging a realtor, be it buying a new home under construction or a a resale home. Just think of it, how many times does a home buyer buy a property in their whole life...compared to the number of properties a realtor transacted in? Experience allows a realtor to give meaningful advice based on the buyer's personal needs and requirements.

#13 By hilda at 6/22/2017 4:13 AM

Hello! I am brand a new realtor and reading this feedback on different topic about real estate helps me increase little at a time of how i will be able to put this into practice. thank you very much !

#14 By Marte Cliff at 6/22/2017 4:13 AM

In addition to helping buyers negotiate a better price, agents who are familiar with the subdivision and the builder KNOW how they can negotiate for everything from upgraded carpet to appliances. Buyers without representation have no idea that they might be able to get more for their money.

#15 By Lauren at 6/22/2017 4:13 AM

Of course...this article was written by a...wait for it...Realtor. And the comments agreeing with what is said here are from...you guessed it...realtors. Exactly what needs to be known in order to buy a house, that is only able to be known by a...realtor? Not buying it. The realtor I have been working with has done absolutely Nothing to negotiate a better price on any home we were interested in. She puts in Zero effort and relies on computer-generated searches and comps to do...nothing. Not buying it. Or maybe I just don't have the right realtor.

#16 By Stephen Young at 6/22/2017 4:13 AM

There are good Realtors and bad ones, the same goes for teachers, lawyers, and every other walk of life.

Lauren: I'm very glad you question people. You seem to have a good head on your shoulders. You are right, words are just words. Look for a professional's effort and sincerity and you will have found the right Realtor. I wish you well.

#17 By Julie Tuggle at 6/22/2017 4:13 AM

Many times you can actually save money using a realtor because there pricing the home correctly the first time and sellers tend to Chase the market down because they priced it too high to begin with. The end up losing more money at the end. Great post

#18 By James at 6/22/2017 4:13 AM

This is a great point and unfortunately all to often people think this is the route to go. As you mentioned in your article the builder has accounted for %6 commission into the cost of the home, so by NOT having a buyers agent just means the builder gets to pocket the difference. You aren't saving anything but in fact not having anyone look out for your best interests. great post.

James Schiller - Real Estate Agent Charleston, SC

#19 By Mike Woods at 6/22/2017 4:13 AM

When I first started selling real estate in Indianapolis, IN buyers would say, "if I don't involve a REALTOR, I can get an additional 3% off the sale price of a home." When they said that, I would ask them to call two builders sales offices in our local market and say this to the sales rep: "I'm thinking of visiting your models today. Would I be able to save 3% off the sales price of any home I buy if I don't involve my REALTOR in the transaction." The vast majority of the time, they would be told no. From that point forward, my clients would involve me in the new home process.

#20 By Lauren Nemeschansky at 6/22/2017 4:13 AM

Great article! Being represented in the process of buying brand new home will certainly not in any way increase the price tag of the home and in no way have any negative effect on the homebuyer. Being represented by an agent, when it pertains to new homes, is something that safeguards home buyer from factors that are not seen and not so obvious. Here in Santa Clarita the builders are getting cheap and they

are offering only 2% commission.

#21 By Ben at 6/22/2017 4:13 AM

Good read, thanks for the post. I agree with what everyone is saying. There are good and bad realtor's, i guess it is your job to find a good one. A good agent will do wonders for the sale of your home. There is only so much you can teach yourself through real estate books and the like. Having a professional help you in any situation can heavily outweigh what you might save by doing it yourself.

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