Contrary to popular thinking, builders will negotiate. You just have to be smart about how you set up the process.
Walking into the builder’s show home and falling in love with the colors, the layout, and the sales rep’s smile isn’t part of the process — at least not your process. It is part of the builder’s process, carefully planned out to ensure you pay full price for what the builder wants to offer.
So take a step back. Go over your notes, review your research, think about those referrals YOU uncovered, and take a deep breath.
OK, now you can go in and talk to the sales rep!
Just remember to remove your emotions from the process. This is a business deal, so take it seriously and be ever so thankful you did your research.
Much more on the actual contract to follow.
great advise, what are some ways to pay lower than the asking price or to avoid paying lot premiums?
ReplyDeleteI feel that you should always make your first offer lower than asking price. Don't go crazy, but a few thousand in your pocket feels good. It depends on how the builder is feeling when your offer comes in, sometimes its just good timing for a discount. Not sure what lot premiums you are referring to, but same principle applies. Have the patience and the persistence to go through the process a couple of times, offer and counter-offer.
ReplyDeleteAfter replying, I heard from an agent who took exception to my comment. He says the builders are not open to negotiation at all. He has a point, and I need to clarify something.
ReplyDeleteBuilders are very sensitive about their base prices, and they never want to appear to negotiate publicly. If they have a model listed at a fixed price, and it sells, the selling price often gets reported in the MLS, and if the builder has accepted a lower price, he feels he opens himself up to future low bids as well.
So here is the strategy that works in this scenario. In your offer, keep the base price as published, but ask for extras to be included, like a fireplace or landscaping. The builder is able to agree (or disagree) with negotiations on extras without compromising his appearance on the MLS reports.