Quote:
Originally Posted by krazycanuck
I work with a builder, and one of the first posts is right. Once you've come in a sales centre on your own, you can't use a realtor for the purchase. In fact, if a realtor agrees to work on your behalf now, they are putting their own licence at risk as it is punishable by the real estate board.
I would suggest that you actually have more leveraging power without a realtor to negotiate the price on a new home. Most builders will pay 3.5% of the first $100,000 and 1.5% on the remaining amount to a realtor. That's almost $10,000 on a $500,000 home. That money either comes from the profit of the home, or in some cases part of the sales person's commission. While the rule is they won't markup the home if you use a realtor, they also will factor in that they are probably losing $7,000 to $10,000 in their profit margins, and will be less likely to want to lose anymore by negotiating down in price.
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Interesting statement
1- Most builders do not pay 3.5/1.5 on a brand new build.
2- I would like to know (pm if you wish) which builder it is that you work with so that I can confirm with someone that there is more room to negotiate without a realtor. Its been my understanding through countless new builds that builders know X% of people will come in with their realtor and these funds are in a different account. 100% non reflective of your purchase price, the houses profit margins, etc. In fact, many supervisors have told me that they like when a realtor brings a client in and is paid as they build a bond and often see that realtor back in with a new client who asked for some help.
I do not mean to call you out and I know thats how it came across however your comment bothered me in that you are coming from the industry but had many incorrect points. Even IF, (this if is 0% but anyway), IF a buyer received some sort of discount for not being with a realtor, a buyer would have to figure out if the discount was equal to having someone in their corner who could save them from being drawn into multiple upgrades that have no re sale value of the house & if it was your first time, the feeling of having nobody in your corner as you sign 100+ pieces of paper!