New Home Secrets from a former New home Sales Associate-what they don't want you to know.
Updated: Jul 9
Okay so this is pretty candid. I used to sell New Homes ( over $10 million dollars worth in a year to be exact ) and there are so many behind the scenes secrets they don't want you to know. I consider myself uber qualified because I also just bought a new home so I've been on both sides. I get the allure . It's NEW. Why buy a "used home" when you can buy a new one for around the same price. That's exactly how I used to sell them haha. Used homes, a stranger's old toe nail clippings in the 10 year carpet, you see where I went with it. And it's true, new is always more shiny and better quality just because its NEW. The appliances work better, there are less pricey problems, and if you do run into an issue, chances are you're under warranty and they'll come right back and fix it. IF you now what you're doing. IF...
Honestly, I see new home buying done wrong 95% of the time. I see these numerous mistakes leaving great deals unused and too much spent on the wrong things. I see people voiding their warranties unknowingly. I see buyers not knowing what the heck they are doing. And why would they? It's the builder who hosts multiple teaching hours for their staff on how to make the maximum profit and how to get your money out of your pocket and into theirs. No one teaches the buyer. Well I'm here to tell all. So buckle up friends!
No one cares about your upgrades.
Your upgrades will not resell. Consider them a textbook over-improvement. An over-improvement by definition is an improvement that will contribute less value to a home than it took to put it into the home. AKA it’s the 25,000 fireplace you put in that an appraiser would only add $10,000 for because that’s what the comparable homes prove it’s worth. But you liked it so much at the design center. Here’s a remedy- DO NOT GO TO THE DESGIN CENTER! You will overspend. And by overspend I’m telling you, that’s the #1 trick to get you to pay $700,000 for a home that had a base contract price of $550,000. And it happens QUICK. Why? Well you’re sitting in a room looking at upgrades right next to one another. So the less expensive one looks awful, by design. Remember this-the design center is designed to get you to overspend.
You know what does resell? Location, square footage and layout. Oh and location.
Do you know how you profit from buying a new home? You sell it for more than you bought it for and there are only two ways to do that. You either buy low or sell high or in my case, you do BOTH. The new home I just bought has gone up $225,000 ( on Zillow to name a source ) since February. It’s July. I did nothing except know how to pick em. Cha-ching!
Base prices are a complete lie. Starting from the $400s! Unless you want a floor, doors and a roof. Give yourself a fighting chance and go into neighborhoods that advertise lower than your price point. And bring a realtor. Make sure that realtor is me.
New home sales counselors don’t really know the answer to your questions. They don’t really know much at all actually. Most of the time these are the realtor that couldn’t really make it in real sale so they became employees. EMPLOYEES with SET HOURS. The antithesis of why any realtor becomes a realtor! I made significantly less in new home sales than I made in resale but I had to put in triple the hours which is the reason I only did it for a little over 1 year. I got out of that real fast lol.
So what I’m tell you is to consider new home sales counselors the front desk people and don’t rely on them for important information. Find the person in the company who you can depend on. Hint-it’s usually your contractor.
You are 100% leaving money on the table if you don’t bring your own realtor. Builders have already set aside money to pay your realtor. Think of this as a bucket. They will NEVER PAY THIS TO YOU or CREDIT IT TO YOU. Why? It’s Illegal and readily monitored by RESPA aka the real estate law. Commission MUST go to a realtor. Oh and here’s a kicker-NOT to their realtor. That’s right. The sales people can NEVER double end a deal. Therefore, they don’t care if you have a realtor or not. In fact, my colleagues and I used to prefer if a buyer was represented so we could talk shop and go through the process with more ease. So if you don’t have your own realtor, you are forfeiting that extra person sticking up for you and leaving money on the table that was already allocated to paying that fee. And believe me when I say that they will take a Realtor more seriously than they will take you. Your house was already priced to pay a realtor. BRING A REALTOR!
*You must bring your realtor on your first visit to the site.
*You must bring your relator on your first visit to the site.
Read it again. It’s a trick, a catch of the new home builders and the take it seriously. If you do not oblige be certain that they will not credit you the commission, they will not deduct it from your home, they will not treat you better or have a fiduciary obligation to you as would your own realtor. You know what they’ll do? And I guarantee this is the ONLY thing they’ll do…they will pocket that money and forget about it. You know who doesn't forget that you earned them $20K? That's right ME. With me you've earned yourself a resource for life.
*You must bring your realtor on your first visit. Do not go for a joy ride and stop into numerous new home sales offices and leave your name and contact. Go for a joy ride around the community and talk to neighbors but never let the sale people see you. Do not tour models. Models are a trap. You home will not look like the model. Bonus secret.
Contractors build better homes for buyers they know and like. Sorry but it’s true. Go to your home site, bring donuts, tell them your name, say hello and do it often. Make is part of your routine. Trust me.
Buy the cheaper home on the block. That’s right. CHEAPER. You really don’t want to be the most expensive home in your new neighborhood. Why? Because every other comparative home is now bringing your value down. You are now the idiot who paid the MOST. Cool house dude. Not so cool bank account or resale value. Your purchase price is not written on the outside of your home-be smart.
You can void your entire warranty and that means the builder will not fix anything in your house no matter what. Oh they didn’t tell you that? Shocker. Did you know that by painting one wall, you void the warranty of all your paint? Like in your entire home. Did you know that if your Bob The Builder husband “fixes” something in your kitchen, the builder may not cover your flooring anymore?
So what to do….you ASK before you TASK. I made that one up. Man I’m not on a humble hill with this post haha. Call your contractor and ASK him if there’s an implication to the warranty if you do x,y,z. And then email him a summary of what he said just to “make sure you heard it right”. Wink wink. Silly little housewife just trying to understand the big boy language or covering her smart butt by getting it in writing, you decide.
I really hope this helps because I look out my front window and can just see these poor unassuming new home buyers making these costly mistakes every single day. I can see it from a far, the money that is wasted and the time and emotion that is used on the wrong things. It does not need to be this way. It can be a profitable, enjoyable experience but only if you bookmark this post. Remember this and pass it along.
Until Next Time,
May all your new homes make you more money than it did the builder.
And I mean that.