Most prospective buyers who enlist agent Mary Ridenhour’s help don’t turn to her looking specifically for a new home. They might explain that they’re seeking a foreclosure bargain or a fixer-upper, or perhaps a house near jobs or schools. They’ll consider all the homes that meet their needs, not just new ones.
Often, as Ridenhour and her clients refine the search, the focus narrows. “My legwork takes me, in the mix of what I show them, to new construction,” she said.
If new turns out to best meet the buyers’ needs, then Ridenhour guides them through the process. She points out differences between a new-home contract and the standard contract for existing homes. She might help them choose fixtures and upgrades in the builder’s design showroom.
Ridenhour is a Keller Williams agent in the Ballantyne office. Perhaps half her clients end up choosing new construction, so she’s able to offer another take on a relationship that’s sometimes misunderstood.
Builders say they welcome potential buyers represented by their own agents – honest! – but that lots of buyers still don’t believe that. Ridenhour agrees on both points, though.
“Builders are glad to see me come in,” she said. “They even offer incentives to agents.”
So, how might she advise a buyer of a new home?
Should a new-home buyer hire an inspector, for instance? It’s often a good idea, she said. “Usually they find minor things that are correctible, and builders have been good about correcting those things.”
For out-of-state buyers, Ridenhour might even walk through a house under construction with the inspector.
Should the buyer finance with the builder’s in-house or preferred lender? Well, maybe. “Here’s what I suggest: Go to a lender that’s not a preferred lender, and get a good-faith estimate. Go to the preferred lender and get a good-faith estimate. ... Compare apples to apples.”
Simple, but something some buyers might not do without a nudge.
Each builder uses its own contract, Ridenhour said, and it’s not the standard statewide form agents use for existing houses. For instance, it’s the new-home buyer’s responsibility to pay the statewide deed tax, not the seller’s, as it would be for an existing home. At $2 per $1,000 of the purchase price, that might not be a lot of money, but it can be a surprise. Buyers might appreciate a heads-up from a pro.
Ridenhour said she often guides clients as they choose upgrades, especially to keep them from over-improving for the neighborhood. Too many expensive add-ons and the house might not appraise for the sale price. Perhaps the family would be better off choosing a new home in another community, where more of their favorite features are standard.
The outside agent’s commission is paid by the builder. Builders typically pay their own staff, and then pay a 3 percent commission that’s split between the agent and her brokerage. That’s the same commission that Ridenhour and Keller Williams would expect for selling an existing house.
There’s no cost to the buyer. And builders say they don’t discount home prices when buyers aren’t represented by outside agents. Ridenhour agrees on that, too.