Real estate, as a topic, is as broad as the Pacific Ocean. From home buyers to home sellers, builders to developers, appraisers to interior designers, real estate is truly multifaceted.
For that reason, there are a lot of real estate practices of which the average person may not be aware. That is why it’s my pleasure to cover as many of these topics as possible and provide you with the information you need to make informed decisions.
Today I’d like to cover the topic of Louisville new construction. We won’t be talking about the choice to buy an existing home or build a new home. Instead we’ll assume the buyers have chosen to build their dream home and look at some of the choices facing them.
Choosing New Construction
Many times people who choose to build their new home have been working with a Realtor and just haven’t found the perfect house. Truth of the matter is … there’s no such thing as the perfect house, but that’s beside the point.
They can’t find what they’re looking for and decide to build instead. That’s great! When it’s all said and done, they’ll have the home they’ve always wanted, just not at a bargain price.
What Is Double Pricing?
Once the decision is made to build, some buyers believe they don’t need their Realtor any longer. Buyers may reason that they could get a “better deal” with a home builder if they don’t have an agent on their side. This idea of double pricing — one price for a home when the buyers have an agent and a second price for the same home if they don’t — has come under fire over the years for many reasons. We’ll look at these reasons next.
1. How will the buyers know if the builder they’ve selected is reputable?
Realtors work every day in real estate and have knowledge about local builders. For example: Which Louisville builders build a quality home? Which cut corners? Which builders have great customer service? Which builders put off follow-up repairs? Which aren’t properly funded and may be out of business in the future?
Anyone can post customer testimonials to their Web site but when a real estate professional recommends a builder, that is far better.
2. How will the buyers know if they’re making the best building choices?
There are a whole slew of choices that buyers will make after selecting the builder. These run the gamut from choosing the lot, floor plan, flooring, cabinets and much more. To an even greater degree, there are many “hidden” selections that the buyer may not know about when it comes to exterior insulation, roofing structures, joist spans and more.
Builders may not even offer the buyer a choice on some of these even though in the end, the buyer will be paying for it at the closing.
If a home buyer has experience building previous homes or is a builder themselves then moving forward without an agent is plausible. Buyers need to keep in mind that having a Realtor on their side to counsel them throughout the process is extremely valuable.
3. How will the buyers know if they’re truly getting a deal?
At the end of the day this is the biggest question. The reason some may proceed without representation is that they believe the builder when he tells them that they will get a better deal without a Realtor.
The only way to know that the home price is discounted would be if the buyer went through this sneaky scenario. By the way, I do not recommend anyone do this.
The buyer brings a Realtor with them to meet the builder at the start, they spec out all the details of the purchase, and get a total price. Then, the buyer goes back to the builder and asks, “What would the price be if I told my Realtor to get lost?”
The reputation of a business is everything
Home builders invest a great deal into their reputations. Homes aren’t commodities and can’t be compared like apples to other apples.
So it makes sense that home builders are acutely aware of how negative publicity can affect their business if the public believes they are a company that steers buyers into ditching their Realtor in order to keep more money for themselves.