Buying a new construction home can feel exciting—and a little overwhelming. Many buyers assume they don’t need a real estate agent when dealing directly with a builder. But is that the best approach?
Let’s explore the key reasons why using a real estate agent for new construction may be a smart move, and how they can guide you through the process from start to finish.
What Is a New Construction Home?
A new construction home is a property built from scratch. It could be a home built by a national builder in a new development or a custom-built home on your own lot.
These homes come with the benefit of brand-new materials, modern features, energy efficiency, and fewer immediate repairs. However, the process of buying one isn’t as simple as picking a model and signing a contract.
Why Do People Skip Using an Agent?
Some buyers think that skipping a real estate agent will:
- Save them money on commission.
- Give them more direct access to the builder.
- Make the process simpler and faster.
However, that’s not always true. In fact, builders typically include agent commissions in the sales price. If you don’t use an agent, the builder keeps that money—not you.
1. Understanding the Builder’s Sales Agent Role
Builder’s Agents Work for the Builder
The person you meet at the model home is a sales representative for the builder. Their job is to get the best deal—for the builder. They are not obligated to protect your interests or advise you like a buyer’s agent would.
No Obligation to Explain Risks
Builder agents are not required to highlight potential downsides or explain complex contract clauses. This puts you at a disadvantage unless you have professional guidance.
2. How a Real Estate Agent Helps
Expert in Local Market Conditions
Your real estate agent understands the local real estate market. They can help you compare similar new and existing homes, evaluate builder reputation, and determine if the price is fair.
Helps You Review Contracts
New construction contracts are lengthy and written in the builder’s favor. Your agent can review them and explain anything confusing before you sign.
Negotiates Extras and Upgrades
You may assume the price is fixed, but experienced agents know what can be negotiated. From design upgrades to closing costs, they can help you save money or get more value.
3. Common Pitfalls in New Construction Sales
Limited Inspection Rights
Builders may restrict your right to bring in a third-party inspector. A real estate agent ensures you fight for that right to protect your investment.
Strict Timelines and Penalties
Delays are common in construction, and contracts often penalize buyers more than builders. An agent helps you understand the terms and avoid surprises.
No Contingency Clauses
Builders often exclude common contingencies (like selling your current home first). An agent can work to include these protections or suggest alternatives.
4. When Should You Bring in an Agent?
From Day One.
Bring your agent with you the first time you visit a model home or contact a builder. If you sign up without your agent, the builder may not let them represent you later.
Most builders will not retroactively allow agent involvement, which could cost you support and negotiation power.
5. The Cost of Using a Real Estate Agent
Who Pays the Commission?
In most cases, the builder pays your agent’s commission. It’s built into the marketing cost of the home. You don’t get a discount by skipping the agent.
It Doesn’t Affect Your Loan
The agent’s fee does not increase your loan amount or mortgage rate. It’s already part of the builder’s pricing strategy.
6. What If You’re Working With a Custom Builder?
For custom homes, the stakes are even higher. A real estate agent can:
- Help you choose a reputable builder.
- Assist with land purchase and zoning questions.
- Guide you through custom contracts and timeline planning.
Without expert help, you risk delays, miscommunication, and costly mistakes.
7. Real Examples Where Agents Make a Difference
- Builder Misses Completion Deadline: An agent can help you negotiate temporary housing or get builder penalties enforced.
- Low-Quality Work: Your agent will recommend inspections and advocate for necessary corrections before closing.
- Loan Delays: Agents work with lenders and builders to keep things on track and avoid losing your deposit.
Conclusion
So, Do You Need a Real Estate Agent for New Construction?
Absolutely. While it might seem like a direct builder relationship simplifies things, it often does the opposite. Without representation, you may sign a contract that favours the builder, miss key negotiation opportunities, or overlook essential inspections.
A qualified real estate agent ensures your best interests are protected, helps you understand every step, and saves you time, stress, and potentially a lot of money.
Read More 10 Real Estate Communication Mistakes to Avoid
FAQ’s
Yes, most builders allow it, but you must bring your agent on your first visit or they may refuse later representation.
No, the builder usually keeps the agent’s commission if you don’t use one—it doesn’t reduce the sale price.
Yes, agents can often negotiate upgrades, incentives, or better contract terms that you may not know to ask for.
