Worthwhile to bring a realtor in if i'm buying a new condo?
 

Hi everyone,

Just a quick question for those of you who have gone through this before. I'm looking to buy a unit in a new condo development. I have pretty much decided on this place, so i'm not really needing to be shown around to other buildings etc. I would like to try and negotiate and get what I can (i.e. discounted parking spot, HST included, etc... whatever I can get) out of the deal.

My question is this, would it be worthwhile to bring on my own realtor to help during this period of time if there's not alot they'll be doing? I know my friends said some may split a portion of their commission with me, however, I am curious if the developer would be more willing to negotiate if I don't bring in a realtor seeing as how they will not have to pay additional commission for them?

I'm not sure what should be done in this case? Have my own realtor try to fight for me but potentially not have as great a deal? Or just go it alone, and try to get what I can?

Any advice would be greatly appreciated. Thanks!

You could use the leverage of not bringing in a realtor as a cost saving for them that they can pass on to you. Win win for them.

If you know the realtor, you can ask them to split their commission with you. You're essentially handing them free money, so ask for some back. It happens all the time with new builds.

Being a new development, and without a realtor.

Just make sure you read the contract A FEW times. I've seen things go to shit because the finishings you wanted weren't correct, or the trim wasn't the right color. Everything is usually stated in the contract, could be vague but an outline is there, and if you have a good realtor they will help with that process.

My 0.02 cents.

I would offer to pay the listing agent's commission and thats it. If you had a realtor, they would get their share. Since you don't, I'd insist on keeping it.

i agree. the contract is very important read and understand every line item. everything is based on this. i know a guy that had problems with a developer b/c their sales lady (wouldn't classify her as a realtor), did not read the contract properly as he had crossed out some line items and added some to see if they would accept it, as it is a back and forth negotiation. it was signed and the developer did not honor it b/c their sales lady didn't read the contract properly :lol

i recently purchased a new townhouse, bought my realtor in, asked him to give me xx% commission. as its easy money for him.

if u r not going to get cost savings from developer by going in without realtor, then get one that will give u some commission.

Always get a realtor, preferably a friend. That way you can ask your friend to give you back 50% commission, which is quite a few thousand dollars.

Your friend doesn't have to do anything except explain some things to you. So a few hours of their time gor them a few thousand dollars. They have nothing to complain about because it's really free money.

Keep in mind that pre-sale condos rarely have room for negotiations. Don't expect too much.

Here's a tidbit, you will have no leverage negotiating on anything even if you have no Realtor representation, especially if it's a well known developer/project marketer with a good project. They are expecting to give up that portion of the commission anyway and would rather go that route than to offer concessions to a prospective buyer since it tends to snowball into other buyers wanting the same deal. A buyer being able to negotiate on a pre-sale is the exception not the norm; these situations tend to happen with leftover inventory that the developer wants to unload (ie: usually the picked-over, hardest units to sell) hence it's common for Realtors to rebate a portion of the comission back to the buyer in these cases.

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Developers work with realtors so they would want to maintain a good relationship. Some places even tell you to bring a realtor as they won't give you more discount if you don't bring one. So better to have one to read through the disclosure packages and ensure everything is good and have him/her split a certain percentage back for you if you felt it was a easy sale

So the consensus is that it should be better for me to bring in a realtor?

The thing is the selling agent for the development mentioned something about him being somewhat confident that he could get them to INCLUDE the tax portion in the price. That's obviously a huge savings, and I want to make sure that I get that.

Reading through most of the thread, and speaking from my own experiences, it's probably best to only bring one if you're buddies with the realtor. Otherwise see what you can get without one.

I recently purchased a pre-sale condo, and my realtor friend and I split his commission, so I got back a few thousand dollars.

Like someone mentioned above, not bringing a realtor doesn't automatically mean savings. I was trying to get the developer to throw in storage for the unit for free, but they wouldn't budge. They gave me a "$1000" wine cooler upgrade instead. But since my buddy came along, I essentially got storage for free, some small perks like side-by-side parking and custom colour scheme, as well as more trained eyes to read over the contract.

It's possible that I could have all that and more without a realtor, but there's no guarantee.

I would automatically think that having a realtor is a good idea unless you are really good with paperwork and know the process inside out. Realtors point out things that you may not necessarily know. But if you do know the paperwork and process, going in without one will save you quite a bit. And as mentioned, its best if you have a friend thats a realtor. Split that commission.

^If you use a realtor you are covered by their insurance too which is huge since you are probably making one of the biggest purchases of your life.

Also, it may be the case that if you use the developer's realtor, they get to double end meaning they get both commissions anyways so they love people that walk on without a realtor.

^ (Usually) Only if the Realtor is contracted out by the developer then they will get to double end the listing/selling; and usually if they post on MLS. Most sales rep that work under a developer only get a certain % from the sale regardless of having a realtor or not.

I worked in presales developments for years and I can tell you it really makes no difference if you have a realtor or not from the Developers side in terms of the $$ area. Developers majority of the time will NOT give discounts or an incentive UNLESS:

-It's nearing the end of the project and there's only a few suites left.
-The project is complete and there are currently resale in the building for suites that are comparable to what the developer has left

Most of the time developers will include the tax within the purchase price if the above are applicable. OR maybe the developer is currently holding a bonus for a limited time for either:

-One extra parking (usually valued at $25-$40K depending on where the property is)
-One extra storage locker
- Pricing has discount if you buy multiple suites, first time homebuyer incentive to buy furniture or whatever etc etc

IF you have a realtor they can go through the contract with you and make sure everything is *thumbs up* Even if you don't have one just make sure you go through the contract yourself and ask questions if you have them. You legally have 7 days to think it over if you want to purchase or not.

I will note that developers love working with realtors because realtors become essentially the middle man and the guy/girl who promotes the project to their clients. It's frowned upon to make direct comments about other competitors even if we know the other guy has lower grade materials/craftsmanship/reputation etc so having the Realtor make those comparables is much better.

In the end, it's up to you but just consider your options.

PS. If you do end up using a friend as your Realtor, a good Realtor-friend would probably split their commission with you anyways. I have given back a portion of my earnings from presales as a "Thank you." But please remember, whatever money was made through a deal from presale..the commission is still split back into the Realtors office. So what you think your Realtor is getting, only a fraction of the money goes into their pockets.

^thank you for your insight miss_crayon.

Just my 2-cents...

IF you are a first time home buyer...having a professional with you can be VERY helpful. The process can be overwhelming and FAST.

I wish I had brought a professional with me when I bought mine (pre-sale, new development, first time home buyer). In retrospect, it would have been much easier to have someone with me who knew about the industry. Before I knew it, I was signing all these papers and documents full of stuff that was confusing. I walked out looking like a deer caught in headlights!

if you're going to do it, yes, have someone to make sure you're doing it right - this is a huge purchase

but i'd have to say, don't do it! rent, it's cheaper, prices are coming down, i'm not just saying this as a bandwagoner, i could go on at length why economically prices will come down

also, condos suck to own, rent, it's cheaper, and if you have/want to move, you can, whilst owning a new condo that the rent on it won't cover your cash outflows - you're fucked

save yourself, please!
http://www.revscene.net/forums/67470...bubble-20.html

I definitely know there's alot to be said about renting, and using the $$ you save to invest instead of buying... but the girlfriend won't have it any other way... She's going in half with me.

Not spending a whole lot on this first place, so hopefully if it drops, there won't really be that far to go... hahaha

*fingers crossed*

Ur buying with ur gf!? That opens up a whole new can of worms

What happens when u break up? If it can't be rented cash positive, think how much u'll lose to commissions / breaking the mortgage

Man, u are fucked if u buy with a gf, a wife, I can see that (although with 50% divorce rate, even that's not a great idea), but just a gf... I don't care what u say, this is such a huge risk

But if u can afford an immediate decrease in net worth of 30-40k (through the liquidity discount associated with owning real estate), then u must be a baller

What has made ur gf so horny to own a piece of real estate? If she thinks it provides security, well, I could argue the exact opposite...

Please proceed with caution... U may look back and really regret this decision in 3 or 5 years, very little chance you'll be thinking "wow, glad I didn't wait"

If you want to become a developer or work in the industry... would it be wise to become a realtor first? would that experience help a lot? or could you kind of just learn the in and outs as you work? please advise. thanks

If your end goal is to NOT be a realtor, but just learn the industry...why not job shadow someone for a few months?

At the very least, you will save some money.