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Why do I need a realtor to build a costum home?

  • April 15 2012 - Grand Prairie
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Answers (10)

A good Realtor should be able to provide you with comparable sales to make sure you are not over paying. I often accompany clients to the design center to help them decide which options will actually add value to their home vs. which ones are likely not going to pay off on resale. They can point out possible issues with resale of your planned home which you might not be aware of. A Realtor is a professional who is on your side in the transaction. No other person represents you -- not the builder, or architect, or the GC. Realtors are paid out of the builder's marketing budget, so having one involved doesn't cost you a dime. Best of luck with your home build, whether you decide to go it alone or hire a buyer's agent.
  • May 15 2012
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Profile picture for SoCal Engr
Okay, so not really a "custom home". More like a-la-carte upgrades. In this scenario, it's more of a classic transaction (vice a custom build).

If you are not comfortable with pricing/negotiation, a REA may be able to help you in this case. Of course, some builders have a rule that the REA had to be there from the beginning, so you'll have to figure that out.
  • April 15 2012
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Profile picture for SoCal Engr
"There are so many horror stories about escrow deposit disputes over unfinished items, missed deadlines, and shoddy construction, that you need a realtor to represent your interests in the transaction."

Assuming a true "custom build", what does the REA add to the equation? In my personal experience...

 - It was the architect who made the drawings, identified materials to be used, drew out the plumbing, electrical, etc. and remained available for consultation if a change/explanation of the plans was needed.
 - It was the G/C who coordinated the trades, made sure work was being done to specs, on schedule, etc.
 - It was the lender who dispersed the funding, released funding based on completions and inspections, etc.

No need/role for a REA in this scenario.
  • April 15 2012
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Profile picture for user769970
I probably should have set that question up better. I am interested in a First Texas built home in Mira Lagos. I figure I will wind up at about $300k after upgrades. I asked the representative if I should get a realtor and of course he said no. I just wondered in the end would it gain me anything like a better price. I figure they will just hide the price of a realtor in to the price somewhere so I procured a price list for add on.
  • April 15 2012
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There are so many horror stories about escrow deposit disputes over unfinished items, missed deadlines, and shoddy construction, that you need a realtor to represent your interests in the transaction.  The builder likely has their own attorney or agent advising them and contrary to popular belief, you won't pay a higher price.
  • April 15 2012
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Profile picture for sunnyview
If you are building a custom home from scratch with your own architect , you do not really need an agent beyond maybe helping you find a lot to build on.

However, if you are talking about buying a semi-custom home from an existing development from a builder, then I would not let the builders agent represent you. You are better off getting your own agent and a good RE attorney to review the contract.
  • April 15 2012
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Profile picture for Ofe Polack
The Realtor is the professional who is in your corner representing your interests.  It is entirely up to you if you want somebody representing you, or if you feel comfortable and are experienced enough to go solo.  Either way, the best of luck!
  • April 15 2012
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Profile picture for SoCal Engr
It seems "custom home" may have a few different interpretations.

When I hear "custom", I think of my experience. I bought the land, independent of the house. I then hired my own architect, drew up a set of plans, and then put the plans out for bid to G/Cs. For this approach, I do not see where a REA's skillsets come into play, once the land has been purchased. I found the architect, G/C and bank rep (one who is familiar with construction loans, draws, change orders, etc.) to be invaluable.

Is this what you mean by "custom"? Or, are you in a situation where the builder owns the land, and is willing to sell under a "build-to-suit" arrangement? Or, does the builder already have a set of standard plans which they are willing to modify for you?

If it's the latter, an experienced REA may be helpful in nogotiating a package deal (i.e., land and build), but I'd look for other help to monitor the actual build process.

p.s. Change orders can kill a project's budget. Some changes may be unavoidable, but negotiate each one carefully. "Custom" and "build-to-suit" can come with some unexpected price tags.
  • April 15 2012
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It is alway easier to negotiate on someone's behalf. So, have someone helping you to negotiate with a builder. It doesn't cost you anything and you might get big discounts with you hire a right agent.
  • April 15 2012
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Profile picture for Matt Hiatt
If you are talking about a builder's subdivision, then my question is why wouldn't you? First, the agent in the sales office ONLY represents the builder, not you. Second, it costs nothing to use an agent, and with me, I have saved my clients sometimes thousands of dollars and in some cases had items get included for my clients, such as I just got one builder to include an appliance package. I can't do this all the time, but I try. Also, I am there representing my clients reading through the contract, public reports, ect to better inform them. Some people think that if they don't use an agent, they can save the money the builder would pay an agent. I use to work in new homes, and that money came out of advertising, so that was not the case.
  • April 15 2012
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