Any experienced realtor will say that selling a new construction project is very different from selling an existing one. It can be exciting for both the buyer and the real estate agent to complete the business for a new home. After all, the buyer will be the first one who lives in it or uses it for its intended purpose. The sale of new buildings, however, is a challenge and requires patience and perseverance of the real estate agent.
Real estate agents need to know about the sale of new construction projects.
The sale of new buildings is a completely different process.
The sales process for new buildings differs from a resale transaction. There are additional steps that are unique to this type of sale.
One of the first things real estate agents should consider is the construction contract. You are responsible for explaining the Buyer’s rights as set out in the Agreement, including the time limit for the Buyer’s ability to terminate without loss of the deposit amount.
Real estate agents also need to ask the contractor for all the inclusion opportunities, financing options, and incentives that can be offered to secure the deal. You also need to know what features are in the base environment and what upgrades. Employees also need to analyze information contained in soil surveys, blueprints and floor plans to guide the potential buyer to an informed decision.
Buyers need a real estate agent for a reason.
For buyers, the purchase of a new building can be intimidating. Often they are dealing with the manufacturer’s own sales representative. Buyers, in turn, need their own agent to take care of their interests. Without one, they risk many risks with their typically most significant investment.
Most buyers are wondering if they can even use the services of a real estate agent when buying a new building. It is therefore the responsibility of the broker to inform the buyer why he needs a representative for this transaction. Agents are there to make sure buyers know important details that can easily be overlooked or forgotten. It is also up to the real estate agent to ensure that the custom features and upgrades are installed as agreed.
The construction contract requires a detailed analysis.
As agents gain more experience with new construction projects, they may find that the process is easier than reselling transactions. There will not be many negotiations on money, appointments and repairs after the inspection. This is about analyzing the wording of the construction contract.
In most cases, these builder contracts contain phrases that favor the builder. It is advisable to ask the seller of the manufacturer immediately for a copy of the contract. If you can memorize the contract, agents can explain the content to buyers in simple words rather than just reading it on the spot. Note the terms and conditions that buyers should pay attention to.
For example, the agent should inform customers that builders will not make any changes to the materials and structural features at the beginning of construction. Builders can not deviate from the original plans that they submitted for obtaining the building permit. It may also contain terms related to errors found during a run. For most builder contracts, the customer can not cancel the contract, but can fix the problem before the sales.
Financing new construction projects can be difficult.
Financing new works can be difficult compared to resale transactions. Dealing with an unfinished house, the completion of which can take months, poses a significant risk. If a buyer hardly qualifies for a home purchase at the time of signing the contract, they may not be able to buy it if mortgage rates increase. Mortgage lenders usually can not set an interest rate longer than 90 days in advance.
It is the job of the real estate agent to help customers make smart decisions. If the client’s debt ratio barely qualifies, the agent should suggest an alternative home that he can afford.
Real estate agents should not escape the challenge.
Since the sale of a new construction project is different from the typical resale transaction, novice real estate agents may be afraid to enter this new area. However, you should face this challenge because it can be satisfying and fulfilling.
Brokers not only find buyers for their dream real estate, but can also provide additional stock for brokers during periods of low resale transactions. As long as real estate agents take due care when looking for builders and visiting model houses, it may be worthwhile to sell new-build real estate.