Alright choir members, hold the hallelujahs for a few moments because I am going to do some preaching. This is nothing we haven’t covered before; however, as with all sermons, the need for a reminder rarely expires, especially after a recent string of confessionals on the topic.
In this industry of real estate, especially right now while we are in the midst of this immediate housing shortage, we are grateful for the deluge of new construction homesites copiously popping up on every available plot of land. The need for vacant land is palpable among builders and developers; and while new construction has, historically, been more expensive than existing, the bidding wars occurring in the current market have driven prices up to the point where that is no longer the case in every situation.
Rest assured that there is a waiting list for new construction as well. Most assembly line builders (defined as a builder who builds out an entire subdivision with a few base plans to choose from and limited ability to customize) have little need to actively solicit buyers. Much like “Field of Dreams,” if they build it, buyers will come. If one of these buyers happens to be you ... for the love of everything that is holy, please, please bring your own representation.
Builders have their own agents. These agents work for the builder. They are more than happy to “represent” you as well, in a limited agent capacity; however, they were hired by the builder to represent the builder. Most builders have already worked agent commissions into the price of the build. If you don’t bring your own representation (licensed, experienced Realtor), this does not save you money. This simply means that the builder’s agent gets to collect on both sides. Limited builders aside, this is most often the case.
Most of you are familiar with this particular rant. However, let me relate a particular unexpected incident that recently occurred which threw me off ... just when you think you have seen it all (which I never assume I have) ...
A couple of weeks ago, I received a call from a client informing me that she and her husband were going to visit one of these builders to put a deposit on a lot. Since they were well-educated on the need for their own representation, they asked if I would meet them there. I told them I was a little further away, but I would kick it into gear and get there as soon as I could. My clients did the right thing and told the builder’s agent that I was on my way because I would be representing them. I had represented clients building with these specific builders recently, so I was familiar with their contracts and processes.
As I was just approaching the area, I received a text from my client: “Never mind. Don’t bother coming. We are not going to do this.” I later learned the unfortunate details.
When my client told the builder’s agent that I was on my way, she told my client to call me back immediately and tell me not to come. She said, “I could get in a lot of trouble for this, but if you don’t bring your agent, you could save some money.” Fortunately, my client knew better and argued that this was not the case. She was well-informed, much to this agent’s disappointment. My client knew the costs were already built into the price. Unfortunately, the builder’s agent’s credibility had been seriously compromised and my clients could not trust this builder or their agent to move forward.
This builder lost not only this buyer but many future buyers as well. I can no longer recommend this builder. While this may be no skin off their back in this market, word gets out, and reputation is everything for a future in this business. “Thou shalt not bear false witness ...” is still in the top 10. The choir may now resume singing.