You are the sole go-to agent or broker for a developer or builder. Sounds great, right? RIGHT – IF you’re willing to work at it. This is not for the faint of heart nor is it for newbies, although one could quickly be thrust into the role if necessary.
A builder’s agent is just that, an agent for the builder of a particular development or subdivision. If you think this is easy money, knowing that pretty much all the lots will sell, think again. Sure, you’ll probably sell a few, but you won’t be the only one. While this is a great niche, it can be tricky to establish. Here are some tips to becoming a builder’s agent.
Why be a builder’s agent?
Being the agent for a builder can offer a lot of leads. Probably more leads than you’ll find on typical platforms like Zillow and even through your brokerage. You could be representing dozens of leads at one time. This can be extremely lucrative but there are drawbacks, advantages, and disadvantages to becoming a builders agent.
How to choose the right builder.
First off, you have to find a builder that is looking for an agent. It’s important to get to know developers and learn about their products and their goals. Many developers are receiving daily emails from a lot of other agents so you’re going to have some competition. You’ll need to build relationships with builders in unique and different ways.
Play the long game.
Make a list of developers you’d like to build relationships with. Make notes of their mailing addresses, where they’re building, the types of homes they build, and anything that stands out to you as being a different type of builder. You want to mail them something that’s memorable. Choose a marketing message that’s branded with your brokerage and your niche and maybe even send a small gift or useful item with your name and contact information.
Send weekly reminders.
If you’re serious about becoming an agent, you’ll need to send them weekly reminders, gifts, or messages with phone calls, social media messages, and ask about their sales. Follow-up calls are useful to find out what the developer really wants but this can be a tricky game to play. You don’t want to be bothersome or a nuisance, but you also want to stay top of mind.
Know with the builder is doing.
You want to stay on top of the builder’s upcoming projects. Ask the builder if they need any help with sales, ask for business, and if you’ve already built up a rapport, you may have a shot. But even if you don’t, and you don’t end up having a direct relationship with the builder, make sure you keep showing the builder that you are interested, professional, and committed. Just because you’re not an agent now for the builder, doesn’t mean that you can’t be in the future. Relationships fizzle and dissolve all the time.
Once you have a builder
Once you have a builder and you are that builder’s agent, you’ll need to fulfill your responsibilities ethically and morally. You may have a lot of properties to sell but you may not make as much money as you expected. Builders and developers tend to be pretty aggressive with negotiations. Builders may will likely want a discount but because of that discount, you’re likely to have far more listings than a typical agent. This can offset the lower commission rates.
Builders also want to know that you have references to related parties. Builders may have a rapport with a certain lender and offer buyers specific incentives and discounts if they go through a particular lender. If buyers don’t want to go to the lender, make sure you have a backup.
Are there certain qualifications to be a builder’s agent?
Any licensed real estate agent can become a builders agent. The builder can use any licensed agent or broker they choose but it’s important to be an experienced agent so that you understand the logistics behind selling lots and buildable parcels of land. While you don’t necessarily need to be a commercial real estate agent, it may help with certain details of each transaction.
Related: Do Google Ads Work for Real Estate Agents?
Downsides to being a builder’s agent.
Representing a builder is very appealing but there are some disadvantages and are likely to get overlooked. Helping a builder’s cell parcels of land can come with long hours, strict schedules, and frequent open houses. Builders may not pay commissions that are as high as those offered on the typical MLS is a buyers agent or even a listing agent. New construction projects means that agents will need to overdeliver including the point of contact. However, the quantity of listings a builders agent is likely to get can definitely overshadow any negatives.
Bottom line
It’s important to understand all the pros and cons and the commitment that comes along with being a builder’s agent. Once you are in the builder agent realm, it’s easier to get more developers on your side. That initial contact and maintaining consistency, communication, and a good reputation is really key to getting more builders on your side.
For more information on how to become a builders agent or learning how to join eXp Realty, contact me at any time.
More tips for agents and brokers:
Part-Time Vs Full-Time Real Estate Agent
20 Questions to Ask When Interviewing Brokerages
8 Ways to Save Big on New Construction
100 Things I Wish I’d Known Before Getting Into Real Estate
