New Construction buyers agent commission (Naples, Destin: sale, lenders, lawyer)

[markjames68]

Originally Posted by Richard818

Builders pay realtors on new construction not for the work they put in but because they want the realtor to drive customers to them. No commission to realtor would mean less homes sold for builder and longer time frame for completing project.

I'm not questioning an amount, I'm reacting more to the "got cheap on us" comment when it was lowered to 2%. As if so much goes into it that 4% is needed. On a $600K new build that's $24K.

That is an excellent question. IMHO, the agent should stay with you and advise you on price, rebates, what options are worth getting, advise about lot premiums and potential resale. They should also help you with the day long finishes choices. Maybe not the whole day but at least an hour or so. That has not been our experience, but I think it should be for others.

I could see if a buyer agent was with you over multiple visits to multiple properties that yes, they should get the commission. So no argument there.

As far as with a builder with an onsite sales team, they will provide you with the rebate/incentive information, popular options and lot premiums.

IF, and it's a big IF, an agent has deep experience in a specific community can they provide better advice, but that's not what I got. The builder's sales team was much better in advising on everything through closing. My agent didn't even show up to the closing. So the fact that she got 4% for so little work is annoying.

[Richard818]

Originally Posted by markjames68

I'm not questioning an amount, I'm reacting more to the "got cheap on us" comment when it was lowered to 2%. As if so much goes into it that 4% is needed. On a $600K new build that's $24K.



I could see if a buyer agent was with you over multiple visits to multiple properties that yes, they should get the commission. So no argument there.

As far as with a builder with an onsite sales team, they will provide you with the rebate/incentive information, popular options and lot premiums.

IF, and it's a big IF, an agent has deep experience in a specific community can they provide better advice, but that's not what I got. The builder's sales team was much better in advising on everything through closing. My agent didn't even show up to the closing. So the fact that she got 4% for so little work is annoying.

I understood that and the "got cheap on us" is why the commission is all about the value to the builder not the buyer. I am not referring to anyone specifically but, in general, if there are 2 similar communities that fit a buyer's needs and A pays 2% commission while B pays 4% commission, it's not a stretch to envision more realtors directing their clients to B.

[markjames68]

Originally Posted by Richard818

I understood that and the "got cheap on us" is why the commission is all about the value to the builder not the buyer. I am not referring to anyone specifically but, in general, if there are 2 similar communities that fit a buyer's needs and A pays 2% commission while B pays 4% commission, it's not a stretch to envision more realtors directing their clients to B.

Maybe it’s a retiree/boomer thing. Before my last purchases, including in Naples, I did a lot of independent research. If I liked a community hopefully a realtor won’t try and steer me away if they paid a lower commission.

[DestinationNaples]

In my experience, a seller's agent who has strong social media and other marketing skills can provide considerable value to a seller. A buyer's agent is a whole different matter. Now that the MLS is accessible over the internet to anyone, a buyer no longer needs a buyer's agent to find homes that are for sale, which was the primary value provided in the past. Today, a buyer's agent's primary value is to drive the buyer around and admit the buyer through subdivision gates. For a first-time or other unsophisticated buyer, the buyer's agent may also provide basic advice and an explanation of contract terms. In my opinion, a 2-5% commission for these services is a ridiculous windfall, particularly for new construction. Before the real estate crash in 2008, a segment of buyers' agents would rebate to the buyers up to half of their commissions. That seems to be much less common today.

[motordavid]

Interesting thread, if a bit confusing to me/some of us...

-We bought our first SW FL house, (new/not yet built), from Lennar in early 2005: we did not use an outside agent as we were looking for new construction. The on site/Lennar employee was helpful but v good in up selling the add ons.

At time of 'signing up' and writing a deposit check, I asked him if there was any possible 'discount' available. He knocked off $5Gs like one would peel off a few bucks for a cart bag guy. I should have pressed for more, but was happy to take the 'discount', which I am sure was already covered by the upgrades we ordered.

Spring ahead to 2013, and we bought our 2nd SW FL SFH in a then WCI golf community in Venice area: again, we did not use an 'outside' RE agent as we were only interested in new construction, and had visited a dozen+ communities for our move from Naples area to this new Escape Winter seasonal house, and all of those communities had one or several on site new house sales people.

The WCI on site agent that dealt with us was very professional, soft sell, and did not pitch upgrades; WCI was using an off site place where the Upgrade Lady was waiting with fangs out, and her best sales game face on...

I also asked our WCI agent if there was any discount available, (not mentioning that we were not going to use their mortgage offer or our own, as we were going to pay cash). He offered up a $10G discount in a NY minute...

There is either considerable profit and room to 'play' from the big chain builders, (2005 & 2013), or both company agents peeled off a few from what they made, (though I wouldn't think their commish was that substantial to do so.)

All anecdotal above and it may be a different 'selling/demand' time these days, but I doubt it.

With all of the new construction in Collier/Lee/Charlotte and Sarasota counties, while all 'popular' in the overall concept of 'move to Florida it is the best place to be', there are hundreds of new/about to be built houses for sale.

I would think that the continual higher material/labor costs/higher selling prices still have some wiggle room. Skip the new house outside 'buyer agent' and find a place(s) you like and ask the company in house agent for some discount. There are gross margins built in and room to negotiate, in our experience.
GL, mD

[JPrzybylski07]

Interesting thread indeed. Traditions don’t always last.

There’s no way to measure objectively how much financial impact a buyer’s agent has on a transaction. I’d like to think a buyer’s agent can act as an emotional barrier during negotiations which can be a powerful tool if done right. Then again is the cost of the buyer‘s commission backed into the selling price?

Also much of the data on Zillow or realtor.com is accurate but there’s also a lot not, but yes interesting thread.

[markjames68]

Originally Posted by JPrzybylski07

Interesting thread indeed. Traditions don’t always last.

There’s no way to measure objectively how much financial impact a buyer’s agent has on a transaction. I’d like to think a buyer’s agent can act an emotional barrier during negotiations which can be a powerful tool if done right. Then again is the cost of the buyer‘a commission backed into the selling price?

Also much of the data on Zillow or realtor.com is accurate but there’s also a lot not, but yes interesting thread.

I’ve benefited from a buyer’s agent twice. Once in NY when dealing with a painful seller. Once in GA when backing out and then re-engaging at a lower price. Both were stellar agents, despite us finding both houses ourselves.

But I really question the value these days in HOA communities where they have an on-site always team.

[Richard818]

Originally Posted by Thundarr457

That is an excellent question. IMHO, the agent should stay with you and advise you on price, rebates, what options are worth getting, advise about lot premiums and potential resale. They should also help you with the day long finishes choices. Maybe not the whole day but at least an hour or so. That has not been our experience, but I think it should be for others.

I have been on both sides of this type of transaction and you are 100% correct. An agent who does provide these services for their client will provide them value far beyond the commission they will be paid.

[Marc Middleton]

Originally Posted by markjames68

But I really question the value these days in HOA communities where they have an on-site always team.

This is incorrect - once the sales are completed, the developer turns over the HOA and the sales people are gone.

[Marc Middleton]

Originally Posted by markjames68

So the fact that she got 4% for so little work is annoying.

Ah, there's the rub. You're mad that the agent got paid what they did. It didn't affect your sales price in the end (all homes sell for the same price for appraisal purposes) so just be happy you got a nice home and not worry about what other people got paid for their services