Why New Home Buyers NEED A Buyer's Agent

(and a qualified one at that!)

According to a recent survey by the National Association of REALTORS® (NAR), 92% of home buyers purchasing an existing home used a real estate agent or broker, however, only 60% of the home buyers that purchased a newly built home used a real estate agent.  To us in the real estate industry, this is odd.  Given that the complexity of the new home transaction versus an existing home transaction and the inherent risk related to new construction versus an existing home, it seems that, if anything, the percentage of home buyers that would seek representation from a buyers agent would be higher on new construction than when buying an existing home but the stats show the opposite is true.

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Buying a New Home should have less risk than buying an existing home, right?  After all, it's New!

This is what a lot of buyers think, that because the home they are buying is new that there won't be any problems with it like you may have in say a 40 or 50-year-old home.  Granted, the systems in the new home are new so, for example, there is a lot less likelihood of your furnace needing replacing in the next 10 years than in an existing home where the furnace and systems make be much older and nearing the end of their useful life.  However, the existing home has existed for a number of years and just by virtue of its age proves some things are ok with the home.  For example, if a 40-year-old home is not showing any signs of settlement or other structural issues, it's reasonably safe to assume the footing and foundation, as well as other structural components, were done properly given that it's withstood the test of time.  For a new home, the odds are slim that issues of this sort would show or present themselves before you close as it may take years for them to surface.  

A bigger problem and risk to a home buyer not being represented by a qualified buyer's agent when buying a new home is the buyer doesn't know what they don't know.  For example, in the St Louis area, we are not familiar with one builder that offers as part of their new home contract a building inspection contingency for the buyer.  This means that while nearly 100% of the buyers that buy an existing home have it inspected by a private building inspector of their choosing to prevent future problems, most new home buyers don't get this benefit unless they are represented by an experienced buyers agent that will make sure they have this right. 

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Below is a video excerpt from an office meeting for MORE, REALTORS® in which  John Donati, one of the brokers at MORE, REALTORS® was addressing this very issue with agents.  In his presentation, John shared some of the pitfalls his clients avoided a new home they were buying (from a very reputable builder of quality homes) because of his representation of them.  This illustrates why, even if you are dealing with a very established, reputable builder (such as the client was in the video below) you still need to be presented by a qualified buyers agent that KNOWS new construction!  

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