-Preparing your buyers- Mike and Shana Acquisto here, real estate brokers and co-owners with the real estate. Let’s discuss preparing your buyers for the build process, specifically with what type of builders in particular?
Well, new construction is hot, hot, hot here. And we’re seeing a lot of a lot of people, you know, there’s not a lot of inventory. So they’re going the new construction route. And there is a misconception that, hey, I don’t need a realtor. I’m just going to go straight to that builder and do my thing. Well, that’s not true, you guys. That is not true. It hasn’t ever been true. They need you in the new construction process more than ever. So you need to be their guide. And first off, it’s choosing the builder.
So I kind of been leery about telling people to look up reviews of the builders, because a lot of it just seems like a lot of reviews that you see out there are negative in a sense. And people tend to to do, you know, like to be angry and voice their anger and dissatisfaction online.
So you’re going to get more negatives, I believe, than positives. But what you can do is guide them. How long have they been around? Have you know if they’re a reputable builder and have been in this area for a long time? You know, they need to know that. So those are just little things that you can you can guide them on.
If it’s a brand new builder that’s, you know, come to town, then, you know, do a little research and find out their history and and who’s a part of the company and, you know, just be their guide. Right. But what I’m hearing now is it’s changed a little bit, OK?
And I think that there’s such a huge influx of new construction going on here that they are having a hard time keeping up right now. And you’re seeing a lot of turnover as far as sales people in the builders office, like the sales counselors, as they call them. They are not. I haven’t seen any anyway, the sales counselors that work for the builder are not licensed real estate agents, their employees, they are employees of the builder, who have their best interests at heart, have a duty to the builder.
So that is something for you to really understand and guide your client through. The other thing is when they you know, you need to just set the expectations.
The building process is long. It can be daunting. It can be very overwhelming for buyers. OK, so I had someone reach out to me actually yesterday and said, hey, I have clients building with this builder and they are not allowed to speak to the builder. Everything they want to do has to go through the sales counselor. OK, OK. Well, because the builder is so probably overwhelmed himself, taking on multiple and more homes at a time than previous, he can’t be distracted all the time.
So I think there’s going to be times that you meet with the builder directly, but everything kind of has to have a filter to go through to keep the process running smoothly. So just remember to set the expectations of your client, right?
What we’re finding and know, the current trends we’re seeing now that a lot of builders have a package that, you know, they don’t necessarily unless you’re doing a high end custom build, there’s not a lot of choices to be made.
Preparing your buyers
You know, previously you would go in to the builder, you would set a design center appointment and you would pick every little detail of the home from the you know, we joked before about light switches, like the do you want the rocker switch or you know, and it’s just like that’s a lot of choices to make. So they’ve kind of eliminated that. And now it’s like, do you like the dark wood package or do you like the light package?
And they have a couple that you choose and sometimes you can choose the package and sometimes you can’t.
You may say, I love this lot. OK, well, this lot this home has already been planned to be built there and there’s no changes.
So just, you know, letting people know that this model type of the home, there’s only certain ones that can fit on certain properties because of the width and restrictions and different items.
So the builders are really streamlining their process of pumping these things out and getting things done more efficiently because they have more or more homes being built. I think that’s a good thing, though.
I sometimes I think the process is a little too daunting for all the choices. And they made it like, let’s have this appointment and pick all these things. And sometimes the consumer makes a bad choice. Right. And it’s not easy for the standard person. So if you do streamline some of those choices, does help and it should drive down cost and it should be more consumer should be more consistent.
Now, as real estate professionals, we all know that when your client goes in, if they happen to go in without you, which it happens all the time, you need to make sure that they’re letting them know that you they have representation and you are that representative. Right. And they need to give your name because if not and they go in and they don’t put your name on, then all of a sudden here you come.
They’re going to be like, oh, well, we didn’t have you on the contract, therefore, you weren’t the procuring the procuring cause. So that in that one issue that I’m saying it’s unfortunate, but it is happening more and more and more. So guide your client, let them know that this you know, they think if they go directly and bypass you, they’re going to get a better price on the home or get something a little extra and.
That’s not the case, so these prices, including, you know, everything through the build process, this is part of those costs that have already been absorbed and in place in the price of the home. So if you don’t come in with them as a representative, that money is still there and it’s going somewhere. So you have to you know, you have to let the builders bottom line going back to the builder.
So you have to let them know that your services cost them nothing. It’s not adding to the cost in the home. It’s giving them a guide that is in their best interest. Right. Your duty is to them. So I just you know, I want to reiterate that to you guys, because it’s it’s something I’m starting to hear more and more of.
And, you know, you definitely need to guide them.
All right. So I did pick up on a couple of items and I wanted to add a few points on what you had just previously said. No. One was that the salespeople are employees of the builder. They do not have a license, meaning they do not need to have all these additional protections that they are bound to.
So what you have to remember that in your mind set that expectation for your client so that salesperson there does not have the bundle? I think there’s like a bundle of rights and responsibilities, like fiduciary care, custody, whatever those are. And then the real estate being a realtor has additional ones beyond just being a licensed agent. Correct. And they so they have none of those?
No, they have none of those. And in fact, we recently had one of our clients, very dear client is going to build and they found a builder and went out on their own.
They did everything. They actually went when we were out of town and met with this builder and called me and said, hey, we’re here. What do you think about this builder and all of this? And I said, well, you know, they’ve been around for a long time. And I just kind of guided them through what I knew of that builder and some of the new trends, things to think about.
So they were very appreciative of that. And as we know, there were a few things that I found extremely interesting. And I have an email from factually misrepresented. I have the actual email from the sales counselor of this builder. I’m not going to point it out. I’m not going to bash anything, but. So they said, hey, Shauna, you said this area over here had belongs to a in a mud district, so the taxes are higher.
They said it’s not the sales guy, so this is a subdivision that’s not in that mud. Well, yes, it is. We know that for a fact because we’ve sold homes there.
So the email clearly states that, hey, you don’t have you don’t belong to a mud. And when your tax rate is X and when you file for your homestead exemption, your tax rate goes down, which is not correct.
You get. Yes, you have a an amount that is excluded in that you’re not taxed on, but your physical millage rate does not change.
Right. So there were a few things in that email that, you know, I feel like they didn’t have a good understanding of what it was.
And they were kind of just basically misrepresenting what the the truth. And they often speak against us. Right, as an agent at the time. Not all the time. I didn’t say always. I said often.
Builders, builders do. And you know why? I think because a lot of times realtors would come in or not come in. And I’ve heard many, many times even from closers at the title company, that they never see the realtor in new constructions, never see them at closing. You know, we treat this just the same as we would any transaction. Heck, we treat leases the same as any transaction. Everybody gets treated the same. Right. Well, and that is really important to do.
Very good, and then I had a second point that I was going to hit on because I said I had to, I covered the first and second one, I forgot it’s like it’s gone. But if it comes back, then we’ll let you know if it’s gone, poof, it’s gone. That’s a shout out to. What’s your name calling Frost telling Frost? I don’t know if she trademarked that or not. It’s kind of cool. I love it would have been others way to go clean. That was actually good branding.
Yeah, OK. OK, so I understand the build the construction process because it’s not going anywhere and you need to be the guide for your client.
Often I’m alerted to this one here, great lender, Brandon Hernon past Tenente guessed from just the other day. Chad today made me think about this, that often they will have incentives, right, to make their while, their loan company, or to just try them and see or run a scenario by them. And if you do this, then they’ll do some stuff there. And I always look at and speak about it.
Yes. I wouldn’t look at that as a total negative, although I don’t I personally don’t like that. Not very fond of that tactic because I feel like your finances are super personal and you should go with someone who it’s not just about the right. I know that is important, but it’s about your relationship with that lender and then being available to answer your questions. I mean, this is their monthly payment.
No, but don’t they sometimes say if you apply with your lender, you apply with the lender, then we will do we will give you ten thousand dollars towards closing costs. So that’s only applies, right? Yes. And then that becomes an issue sometimes.
And that’s fine. I think, you know, looking at it, trying to look at it from a positive, I can see if a builder is taking a home and starting a process, then you want to make sure they can at least qualify. So at least pre qualifying with their lender, I have no problem with. Right. Yes. But tying these incentives in. But you know, what we found often with Brandon is I say, hey, you know, you have to do this. So go with their lender and do your application, then go to our preferred lender.
And, you know, we have a great you know, Brandon is great about this is he’s very honest and he’ll say, hey, I can do your loan. This is how it’s going to be different from what they’re offering you. Right. And sometimes they may say you’re getting ten thousand dollars in closing costs and it’s it’s huge for someone. They’re saving ten thousand dollars, but you might be making up for it somewhere else.
So, you know, I’m using Brandon as an example. He’s been very, very good about explaining this to our clients and and letting them know that, hey, I can bump your rate up to here and cover all those closing costs. And it’s a much better situation than what they’re offering you. So just having we use the analogy of if you’re going in for surgery, you know, you’ve probably talked to more than one surgeon.
So it’s kind of the same with this. If somebody is dictating something to you and they’re saying, hey, you know, this deal right now, this is what we’re going to give you, just fact check it, double check it and get a second opinion.
Very good and sometimes good things are great and they can’t be, and sometimes they can be right. Yeah, Sue, and, you know, sometimes it feels good and sometimes it doesn’t. Lindsey chats and about that. And so, you know, just to speak with a realtor and be your advocate. Yes. And we’ll go through that process. All right. Thank you, guys.