I recommend that all home buyers use an agent if they think they need an ally when they purchase or sell a home. A great agent should be able to help you find an amazing deal, expose you to properties that you may not know existed, and many have extensive experience dealing with home builders. While the internet is a great tool and can help you get a ton of information, a real estate agent is a valuable asset when you’re going over contracts and gathering data for you while you’re getting your research together, and even setting meetings. Builders will take you more seriously if you’re working with an agent because the overwhelming majority of homes they sell (eight out of ten) will have an agent assisting the buyer on the deal. Most agents will appear with you at the closing table and answer any questions you have, and they have a way of making buyers feel secure as they move through this process.

There are also some monetary benefits to working with an agent. First, builders are reluctant to alienate agents with hard negotiating tactics because they know that one bad experience with an agent could cost them an additional 8 to 10 sales in the next year with that agent, or others with whom they associate. Agents talk to each other, and the last thing a builder can do is get a bad reputation. Second, the agent field is getting extremely competitive, and many agents will cut great deals with you to represent you. Many agents will offer special deals to shoppers that work with them. Some will sell your existing home for free if you let them represent you when you buy a home. Some will only charge you 1% and return the additional 2% to you. Some will work for 3%, but return all builder cash or additional commission to you. All will be bound to tell you what the builder is paying them. Find out what kind of deal they’ll offer you to represent them on a sale. Some agents won’t offer anything, but many will work for a reduced commission or will offer to return back any additional commission or bonus the builder is offering. Not all states allow agents to return or reduce commissions, but most (40) do. Working with an agent is no different from working with any other freelance vendor. Everything’s negotiable and remember, a little number like 1% or 2% may not sound like much, but on a $350,000 home, every 1% you save on commission is $3,500 in your pocket or off the price of the home. If a builder is offering 5% commission, which many are doing these days, and your agent says they’ll do the deal for 2%, on that same home you’d be saving over $17,000, and that’s a lot of money. Find an agent you like and make your best deal with them. You can interview several before you pick the one you’ll eventually hire. You should shop for your agent like you shop for anything else and go with the agent that you think will do the best job and get you the very best deal on your house.


Sadly, some builders will tell you that you can get a better deal on your new home if you work with an agent because they won’t have to pay the agent their commission if they can deal directly with you. Most salespeople would never do this, but the fact is that there are many out there that will. Builders that make it a practice of trying to “cut the agent” out of a deal generally don’t last too long in the home building business. Once word gets out that they’re actively discouraging agent assistance to shoppers, agents stop showing that builder’s homes, and once that starts, it’s only a matter of time before the builder will close its doors or change their ways. Most builders create their pricing with the assumption that an agent will be assisting the buyer with the sale.

It’s also important that as soon as you decide to go with an agent and find one that you think will perform the best for you, that you sign an Agent Representation Agreement. These usually last six months (though you can extend them), and they indicate to everyone that you’re being represented by an agent. The law states that if you don’t do this, even if the agent is working with you, they are actually an agent for the seller (builder). With this agreement, they are officially bound only to represent your best interests.

Finding the perfect agent is a lot like making any other important financial decision. The less emotional you keep the decision-making process, the better off you’ll be. I’m not saying you shouldn’t hire your sister’s son who just got his real estate license to help you, I’m saying, only hire him if he’s really good. The fact is, you are paying the agent, not the builder, and you should get all you can for your money. Do your homework with real estate agents just like you would with a builder and you should get the best home at the very best price!