Buying new home: Advice needed

[Reckless_Abandon]

I'm putting earnest money down tomorrow to lock up a lot. Negotiations over purchase will ensue thereafter. The home will be built through Shea Homes.

Some Questions.

I'm not using a real estate agent because I'm planning on asking for his percentage off the house. I've heard this percentage is between 2.5-6%. Since it's a new home, I'm guessing something like 3.

The housing market is slow right now and there are lots of homes on the market. I'm pretty sure we're the only couple competing for this lot. How much can I get away with lowballing them on my initial offer?

I know the questions are somewhat vague, but any help is appreciated.

[danny31415]

What area are you buying in?
You might have a hard time getting them to give you the realtor comissions (or they might try to tell you they are without actually doing it), so be careful with that. If you are not actually going to be saving money then you should just get a realtor, because it will make your life easier.

Have you ever bought a home before? Do you have anyone you can ask for questions, that you know personally, about shady things on the paperwork or other ways where the builder might try to screw you (a family member that is a realtor, loan officer, or some other real estate type person). If the answer is no to both of those you should at least think about getting an agent. If you do go for an agent you might try to negotiate to get some of your fees back. They may be willing to do this because typically there is less work for them on new homes, YMMV. Here is a blog entry of an arizona realtor that talks about his client buying a new home that had a 8% comission (high because of a slowing market), and he gave back 6% to his clients (I'm not affiliated, I just read his blog).

link

Another word of caution, beware the builders lender. The builder will often offer to pay some of you closing costs etc, but have it conditional upon using their lender for your loan. Be sure to shop around on a loan and see if the closing costs are really worth the higher rate/more points etc.

Good luck.

[PokerAce]

[ QUOTE ]
I'm putting earnest money down tomorrow to lock up a lot. Negotiations over purchase will ensue thereafter. The home will be built through Shea Homes.

Some Questions.

I'm not using a real estate agent because I'm planning on asking for his percentage off the house. I've heard this percentage is between 2.5-6%. Since it's a new home, I'm guessing something like 3.

The housing market is slow right now and there are lots of homes on the market. I'm pretty sure we're the only couple competing for this lot. How much can I get away with lowballing them on my initial offer?

I know the questions are somewhat vague, but any help is appreciated.

[/ QUOTE ]

First, not using an agent is a bad idea. The seller has already agreed to pay a % to their selling agent. If the buyer has an agent, the two agents will split the commission. All you will be doing by not using an agent is making the seller's agent more money and putting yourself at a significant disadvantage.

Your initial offer could probably be 85-90% of the asking price and not come across as insulting. Expect a counter-offer.

[shark6]

Get a professional realtor to help you. There is too much money changing hands and too many opportunities for you to be taken advantage of to risk trying to saving a few percent.

The realtor will help you with negotiations. If possible, try to get the sellers to lower the price without you even making your first offer. That way you anchor the negotiations to as low of price as you can. And oh ya, get a realtor to help you.

[Ray Zee]

you dont put earnest money down until you have an accepted offer. never ever do that.
plus your lot purchase is separate from the building of the house. two separate transactions. if you link them you are paying thru the nose to the builder. dont buy a lot where you cant chose your own builder if you want.
find somone with credibility to help you.