Home Buyer's Guide and Tools

By Sammy Gardner

THE MODEL HOME MYTH: HOW TO LEVEL THE “BUYER VS BUILDER” PLAYING FIELD 

After years in the Real Estate business as an owner and broker, I have spent many hours looking for the best way to educate people before they enter a model (new) home. I have seen far too many people be taken advantage of. Please read the following and see what you can learn from “Tom and Cindy’s” experience. Most buyers are operating on a very uneven playing field. Think about it for a minute…the sales rep for the builder may sell 15-20 homes per month. But, this may be your 1st, 2nd, or 3rd home. That means you are vulnerable when compared to the builder’s rep. Great sales reps are excellent at maximizing their employer’s (builder) profit centers, often to your disadvantage as a new home buyer.

Understanding this information will help you to find the right home, pay the right price, in the sub-division that best suits your needs…with maximum upgrades…with the right builder, the right loan, the right rate…and experience an enjoyable closing. We at Home Centers Realty are adamant about this. We believe that the day you close should be a celebration rather than a day filled with regret and anxiety. If you act on the following information, you may save thousands of dollars and a great deal of time and stress.  Beyond that, we don’t want you to live in your home for three months only to find that you could have lived in a better area and in a superior home.

THE “TOM AND CINDY” STORY

While Tom and Cindy are driving around on a Sunday afternoon, they spot the flags indicating an open, decorated model. They soon find themselves inside the attractive home. After greeting Tom and Cindy, the salesperson will ask them to complete an information card. This card will inquire about Tom and Cindy’s Realtor® representation. In the past, builders would sometimes offer Tom and Cindy 3% off of the sales price IF they did NOT have a Realtor® representing them. Tom and Cindy were excited and told their Realtor® friend “it’s just business…sorry.” The big winner in this scenario was the builder…so they thought. (But, if a Realtor® is cut out by a builder, that Realtor® may then tell their office of 100 Realtors® that “xyz” builder offered their client an incentive to enter the transaction without them. As a result, many Realtors will stop taking their clients to that builder. The builders’ sales will decline and the home buyer is left without full and free representation). The more reputable builders now “store” that 3% in a marketing budget. This 3% will remain in the marketing budget IF Tom and Cindy don’t indicate their Realtor’s® name on the registration card. In other words, the builder now has the money in a separate fund so Tom and Cindy can utilize the skill sets of a “Certified Home Center Realtor®.” Furthermore, many of the more reputable builders now WANT Tom and Cindy to have a Realtor®. Why? A great Realtor® coordinates all of the details, and teams up with the builder to make sure that their mutual client will be proud of their new home, of the price they paid, and of the experience they had. That means that Tom and Cindy can benefit from the services of a “Certified Home Center Realtor®” … COMPLETELY PAID FOR BY THE BUILDER. Home Centers Realty has selected seasoned experts to represent you. They are Realtors® and “Certified Home Center Specialists.” It is essential for a Realtor to “know” your specific area.  If you are looking to purchase a home in Frisco, you need a Realtor who specializes in Frisco.  The same is true whether you are looking to buy a home in McKinney, Allen, Prosper, etc.  To my surprise, many Realtors® do not know the area they are working in. Can they really show you your best options?

COMPARE THE DIFFERENCES… In Tom and Cindy's case, they want to move to Frisco.  Without a “Certified Frisco Realtor®”… Tom and Cindy enter a model home having never purchased a home from a builder. They deal with an employee of the builder who fully understands how to sell every margin…every profit center.  Tom and Cindy are a “one deal” transaction. They negotiate the deal without knowing the strategies associated with upgrades, the loan, special discounts, incentives, etc… Furthermore, they will “go it” alone and be at the mercy of the title company, the lender, the builder, and the appraiser. While Tom and Cindy should be packing and enjoying the excitement of moving into their new home, they wonder when they are going to close, and whether or not they got the best deal. With a “Certified Home Center Realtor®”… Tom and Cindy walk into a model with a “Certified Frisco Realtor®.” The builder’s rep views Tom and Cindy’s Realtor® as an extension of their business. They know the Frisco Home Center Specialist understands the “games.” Tom and Cindy will now receive the best possible deal. The “Certified Frisco Realtor®” even knows the builder’s lending strategies and fully understands their methods and profit centers. … many Realtors® may not realize that many homes in Frisco are NOT in the Frisco Independent School District. They may even do home searches within the FISD and exclude many great homes IN Frisco. In many cases, Tom and Cindy’s emotions are very high. They want to believe what they hear and the sales rep wants them to believe what is said. But, too often the naïve nature of an emotional buyer is “preyed” upon. The “Certified Frisco Realtor®” keeps them balanced. We (CFR’s from the Frisco Home Center) will be there when you sign the contract with a market analysis to determine the fairness of the price. We will monitor and manage the details from beginning to end. We will be there for your walk through, and we will be there when we celebrate your new ownership. We will even be a resource to you after you move in. To us…it’s not just business…it’s personal. Tom and Cindy’s Realtor® will also make sure that they are not taken advantage of on their financing. All too often, Tom and Cindy will be given incentives to use the builder’s lender. Be careful. Tom and Cindy may be offered $10,000 worth of upgrades but they often pay for it by paying a much higher rate or payment.  If the builder’s lender is treating you fairly, we will be the first to tell you. And if they are not, we will be the first to tell you. We will also make available to you a veteran of the lending business for excellent consultation. Many builders’ lenders are not skilled in evaluating your overall plan and offering options relevant to your payment and equity objectives…both short and long-term. The ideal scenario… Tom and Cindy contact The Frisco Home Center and ask for a “Certified Frisco Realtor®,” who specializes in Frisco. Some Realtors® claim to be a “specialist” in Dallas, McKinney, Frisco, Allen, Plano and Fort Worth. It is difficult enough to specialize in one city …much less 8-9. Tom and Cindy deserve representation that is vastly familiar with Frisco and its sub-divisions. Tom and Cindy’s Realtor® knows the local market. This may sound simple in this day of the internet, when buyers have access to much of the same data as the agent. The difference is the ability to interpret the data. Good Realtors® study the market trends and observe market fluctuations. For example, many Realtors® may not realize that many homes in Frisco are NOT in the Frisco Independent School District. They may even do home searches within the MISD and exclude many great homes IN Frisco. Also, keep in mind that most newly built homes are not found on the internet through the same sources as resale or existing homes (MLS). This makes it difficult for Tom and Cindy to compare “apples to apples.” “Certified Frisco Realtors®” visit the new sub-divisions on a regular basis and track their sales. They know which areas of town are appreciating the fastest and which builders are nearing final construction in their sub-division. They also know the builder’s fiscal cycles and know the best time to purchase a home from a particular builder in order to secure the very best value. A “Certified Frisco Realtor®” will listen to Tom and Cindy to determine their wants and needs. Tom and Cindy will be reminded of the difference between “STYLE AND SUBSTANCE.” SUBSTANCE consists of things that cannot be changed such as the location, view, size of the lot, noise in the area, school distract, commute time and floor plan. The STYLE represents easily changed surface finishes like flooring, wallpaper, color and window coverings. The Realtor® knows the various sub-divisions, builders and homes being offered. They are familiar with directing Tom and Cindy to the communities that offer only what they are looking for. A “Certified Frisco Realtor®” will also assist Tom and Cindy in negotiating the value of the home, with the loan kept as a separate transaction…period. They will help negotiate the “must haves” and the “would be nice” upgrades. Both the Realtor® and Tom and Cindy must have fortitude and knowledge to make this happen. Tom and Cindy’s Realtor® will act as their “link” between the builder, lender, and the title company. This is critical. He/she will assist them with the necessary paperwork and act as a resource for inspectors and other professionals necessary to facilitate the closing on their new home.

Home Centers Realty would be honored to introduce you to some of the best Realtors® in the area. We want to introduce you to the right team of professionals from the beginning, so that the purchase of your new home will be a pleasing and memorable experience…without any regrets. Remember, this is one of the largest financial decisions you will ever make.  With us, it’s not just business … it’s personal.

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