Why It's Imperative to Have a Real Estate Agent for New Construction

by Paul McParland

New Construction in Atlanta

Purchasing a home is a significant milestone for most people, whether it's their first-time buying a home or a step up to something new and exciting. When considering new construction homes, many buyers assume that the process is more straightforward than buying a pre-owned property. After all, you're dealing with a brand-new property, built to your specifications, without the complications of previous owners. However, what many homebuyers don’t realize is that the process of buying new construction comes with its own unique set of challenges and potential pitfalls. This is where having a real estate agent becomes not just a benefit but a necessity.

In this blog, I will explain in detail why it's imperative to have a real estate agent representing your interests when purchasing a new construction home. While the builder’s representative may seem knowledgeable and helpful, it’s important to remember that they work for the builder—not for you. Having a dedicated real estate agent by your side ensures you have an advocate throughout the process, helping you navigate contracts, negotiate better deals, and avoid costly mistakes.

1. Representation and Advocacy

One of the most important reasons to have a real estate agent when buying new construction is the representation they provide. When you walk into a model home or speak with the builder’s sales representative, it’s easy to feel like you’re getting all the help you need. The sales agent is friendly, knowledgeable, and eager to assist you. However, what many buyers don't realize is that the builder's representative is employed by the builder and is primarily focused on protecting the builder's interests.

Having your own real estate agent ensures that you have someone advocating for your best interests. Your agent’s sole responsibility is to represent you, the buyer, and help you get the best possible deal while protecting you from any potential pitfalls in the process.

Some key ways a real estate agent can represent your interests include:

Negotiating upgrades: Builders often offer standard features and packages, but many buyers want to customize their new home with upgrades. A skilled agent can help you negotiate for upgrades or incentives that might not be readily offered.
Ensuring transparency: Contracts for new construction can be lengthy and filled with fine print. An experienced agent will ensure that all aspects of the contract are transparent and in your favor.
Monitoring the construction process: A real estate agent can help keep an eye on the construction timeline, ensuring that deadlines are met and the final product aligns with what was promised.

2. Understanding the Builder’s Contract

When purchasing new construction, buyers are often required to sign the builder’s contract, which can be quite different from the standard contracts used in traditional real estate transactions. These contracts are written by the builder’s legal team and are often weighted heavily in favor of the builder. Without experience in reading and interpreting these documents, it can be easy to miss important details or agree to terms that may not benefit you as the buyer.

A seasoned real estate agent will have experience with builder contracts and will be able to:

Review the contract thoroughly: Your agent will carefully examine all the details of the contract, identifying any terms that might be problematic or confusing. This is especially important when it comes to clauses regarding timelines, warranties, and changes in price or scope.
Explain the fine print: Builder contracts can include clauses that you may not understand or might overlook, such as allowances for construction delays, unexpected price increases due to material costs, or requirements for final inspections. Your real estate agent will explain these terms and help you understand what you’re agreeing to.
Negotiate contract terms: While many buyers assume that builder contracts are set in stone, the truth is that some elements of the contract can be negotiated. A knowledgeable agent can identify areas where the terms could be more favorable to you and help you negotiate accordingly.

3. Getting the Best Price and Incentives

Builders often offer incentives to entice buyers, such as upgraded finishes, appliance packages, or closing cost assistance. However, many buyers don't realize that these incentives are not always advertised upfront. Having a real estate agent who knows how to navigate these deals is crucial to ensure you get the most value for your money.

A real estate agent can:

Help you compare offers: Builders often market their homes at a base price, but the cost can increase significantly when you add in upgrades or other customizations. Your agent will help you compare offers from different builders to determine which one offers the best value for your needs.
Negotiate for additional incentives: If the builder is offering certain incentives, an experienced agent may be able to negotiate even more perks for you, such as additional upgrades, discounts on closing costs, or extended warranties.
Provide insight on pricing: Your agent will have a solid understanding of the local real estate market and can help you determine if the builder’s pricing is fair or inflated. In some cases, builders may be willing to negotiate on price, particularly if the home has been on the market for a while or if they have multiple unsold units in a development.

4. Guiding You Through Upgrades and Customizations

One of the biggest appeals of new construction is the ability to customize the home to suit your preferences. From flooring options to cabinetry and countertops, builders often offer a variety of choices for buyers. However, navigating the upgrade and customization process can be overwhelming, and the costs can add up quickly.

A real estate agent can help you:

Make smart upgrade choices: While it can be tempting to go for every available upgrade, your agent can help you focus on the customizations that will add the most value to your home in the long term. They’ll also help you avoid over-improving the property beyond what the market can support.
Stay within budget: Upgrades can significantly increase the final cost of your home. A good agent will help you set a budget for upgrades and guide you through the selection process so you don’t end up overspending.
Know which upgrades are worth it: Your agent will have insight into which upgrades will give you the best return on investment. For example, certain kitchen or bathroom upgrades might increase the home's value more than others, while other upgrades may be less impactful in terms of resale value.

5. Assisting with Lot Selection

In a new construction development, you’ll often have the opportunity to choose your lot. The lot you select can have a significant impact on your home’s future value and enjoyment. Factors such as proximity to amenities, views, and positioning on the street can affect everything from resale value to daily living.

A real estate agent will:

Help you evaluate the best lot: Your agent will help you assess the pros and cons of various lots within the development, considering factors such as location, privacy, lot size, and exposure to traffic or noise.
Provide insight on resale value: Not all lots are created equal, and some will offer better resale potential than others. Your agent will have a keen understanding of which lots are more desirable based on their knowledge of the local market.
Consider long-term development plans: Your agent can help you understand how future phases of the development or surrounding infrastructure projects may impact your lot’s value over time.

6. Managing Construction Timelines and Delays

One of the challenges of buying new construction is the potential for construction delays. While the builder may provide an estimated completion date, weather issues, supply chain problems, and labor shortages can all cause the timeline to shift. A real estate agent can be a valuable ally in managing these delays and ensuring that you’re kept in the loop throughout the process.

Your agent will:

Monitor the construction process: A good agent will stay in touch with the builder and regularly check on the progress of your home to ensure it’s being built according to plan.
Address delays proactively: If there are delays, your agent can help you understand how they will impact your closing date and negotiate solutions with the builder, such as temporary housing or compensation for the inconvenience.
Assist with inspections: Throughout the construction process, there will be multiple inspection points, including pre-drywall and final inspections. Your agent can recommend trusted third-party inspectors to ensure that everything is being built to code and that any issues are addressed before closing.

7. Expertise with Financing Options

Financing a new construction home can be different from financing a traditional home purchase. Builders often have preferred lenders that they work with, and they may offer incentives for using these lenders. However, just because a lender is preferred by the builder doesn't mean they offer the best deal for you.

A real estate agent can help you:

Compare financing options: Your agent can guide you in comparing loan offers from the builder’s preferred lender and other financial institutions to ensure you get the best rates and terms.
Understand builder financing incentives: Sometimes builders offer closing cost assistance or other perks if you use their preferred lender, but the loan terms may not always be the most favorable. Your agent will help you weigh the pros and cons of using the builder’s lender.
Navigate the construction loan process: If your new construction purchase requires a construction-to-permanent loan, your agent can help you understand how the process works and ensure that your financing is set up correctly.

8. Handling Final Walkthroughs and Inspections

Before you close on your new construction home, you’ll have a final walkthrough with the builder to ensure that everything is in order. This is your last chance to identify any issues or defects that need to be addressed before you take ownership.

Your real estate agent will: Accompany you during the walkthrough: Your agent will be by your side during the final walkthrough, ensuring that all agreed-upon work has been completed and that the home is delivered in the condition promised

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Author Bio: Paul McParland is an experienced realtor with a passion for helping clients navigate the North Atlanta real estate market. Whether you're buying or selling, Paul's local expertise and commitment to personalized service ensure a smooth and successful transaction.

Contact Paul today for all your real estate needs: