Buying a New Construction? Protect Your Interests! Get Represented!
Recently I was reading a contract for someone that is purchasing a new construction home. They went there on their own, signed a contract and asked us to read through it for them after the fact. I was struck by some of the statements within the contract. I can't speak for all new build contracts, but this particular one stated "Seller has acted as its
own real estate broker. Purchaser acknowledges that Seller’s sales agents represent Seller only and do not represent Purchaser or have any duty to Purchaser. Purchaser represents to Seller that Purchaser has not employed any real estate broker, agent or finder in connection with this Agreement." This is saying the person buying this house does not have any representation. The problem with this is the buyer doesn't have anyone looking out for their best interest. It is up to themselves to do all of their negotiation and make sure they understand the contract and that the builder is living up to the terms of the contract. While there are many people savvy and capable of doing this, a licensed agent who is used to reading and executing contracts on a daily basis is best served to look out for the buyers best interests.
Whenever we first start working with a new buyer, we like to share this article. It talks about things you should do before considering to buy a new construction home. It is all about how to protect yourself and make sure you are getting a good, solid house at a good price. Their 10 things to do include:
1) Use a real estate agent... it costs you nothing to protect your interests.
2) Check out the builder
3) Research the community
4) Choose square footage and location over upgrades... you can always make the upgrades yourself later.
5) Don't over improve... you don't want to be the most expensive house in the neighborhood
6) Understand your floor plan and the size of the rooms compared to where you are currently living
7) Have a lawyer vet the contract before you sign... especially if you aren't using a real estate agent
8) Ask about warranties that come with the house
9) Get a home inspection
10) Get multiple bids from lenders and closing agents... the deals offered by the builder can often be met or beat by others
When I look at the list above, it is all about doing your homework and surround yourself with people that care about what is best for you and not just having the interest of the builder. Don't let the urgency given by the builder's representative push you into a contract too quickly. Do your homework and make sure it is right for you!
Do you know anyone that wants to buy in the central Florida area? Please let us know. We are here to serve.