Home Builders and Real Estate Agents: Friends or Foes


The home builder, real estate agent, and buyer relationship can seem like a complicated one.

  • On the one hand, you’ve got the builder who wants to sell new homes and maximize their profits on each sale.
  • On the other hand, you’ve got the buyer who wants to make a wise investment without spending too much.
  • And then you’ve got the real estate agent who seems to get stuck in the middle trying to make both parties happy.

So in the modern housing market, what is the truth about the home builder / real estate agent relationship?

Does it have to be complicated and adversarial? Or can it be mutually beneficial?

Let’s take a quick look at some common misconceptions, the benefits of effective collaboration, and a few tips for making the most out of this relationship. Whether you’re a builder or an agent, this is something you need to read.

Myths and Misconceptions of the Home Builder/Real Estate Agent Relationship

Here are two of the most common myths that buyers and housing professionals tend to believe.

Direct Communication between a buyer and home builder eliminates the need for an agent

What some think: Buyers should just deal directly with the home builder and their sales agents.

Truth: Homebuilders and their sales agents want buyers to be happy. But at the end of the day, they work for the builders. That means the builder’s interests will ultimately take precedence over the buyer’s interests.

By working with their own real estate agent, buyers have someone in their corner who is looking out for their best interest.

Real Estate agents will take a huge commission and decrease the home builders’ profit

What some think: Buyers and builders can save tons of money by cutting out the middleman.

Truth: While it may seem like a good idea initially, in the end, builders will lose out on a lot of business. Once real estate agents know that a builder is cutting them out of deals, they’ll stop referring clients to that builder. Fewer referrals means less traffic and declining profits.

Benefits of a Partnership between Home Builders and Real Estate Agents

So why should home builders and real estate agents work together? Here are two powerful reasons.

Boost Revenue

Effective collaboration between home builders and real estate agents leads to increased profits for both.

Real estate agents who refer clients to a trusted home builder are more likely to make sales. Even if the agent’s client is looking to buy a used home, by presenting the option of going with a new home builder, clients are more likely to find something they like which could lead to a sale. More sales equal more commissions.

Homebuilders get more potential clients and higher conversion rates when working with real estate agents or brokers. When a real estate agent recommends a builder to a client they effectively give them a stamp of approval. That makes it easier for the builder to close more deals.

Increase Listings

While most builders have a sales department or in-house agents, successful realtors and real estate agents can help them quickly get their listings in view of more people. That leads to faster sales for builders.

Real estate agents who offer their marketing skills to builders can take advantage of this to quickly increase their listings. More listings lead to more opportunities for sales. And that in turn, translates to greater profits!

*PRO TIP – It’s difficult to create a listing to sell a home that’s still under construction. That’s why more builders and real estate agents are turning to software like Cedreo to quickly create a 3D version of the finished home along with photorealistic renderings they can showcase on their listings.

Cedreo 3D rendering of a modern house at night
3D render of a farmhouse house designed with Cedreo

How to Create a Mutually Beneficial Relationship

You’ve seen the benefits of builders and real estate agent collaboration. Here are some tips for building an effective relationship.

Build Relationships with Open-House Events

Open houses aren’t just for buyers. Smart builders hold open houses for other housing professionals, including real estate agents and brokers.

Builders should use their open house events to showcase their new units and start conversations with agents.

  • Encourage agents to ask questions
  • Get to know the agents, their personalities, and working styles
  • Explain your selling process and the benefits of collaboration

Real estate agents can also take the initiative to visit open house events.

  • Ask about the properties so you have all the essential details to share with clients
  • Ask about opportunities for collaboration
  • Get to know the builder and their selling process

Mutual Understanding of the Co-Op Policy

Co-op policies make it clear what builders expect out of real estate agents they collaborate with. They promote clear communication and help keep everybody happy.

One of the most important parts of the policy is the procuring clause. This outlines details of the transaction between the real estate agent and the buyer and usually requires the agent to disclose their relationship with the buyer right from the start.

If after the fact, a builder finds out their client is already working with a real estate agent — who now expects a commission — it’s likely to lead to conflict and a poor working relationship with the real estate agent.

So as builders and agents decide to work together, it’s important that each side has a clear understanding of the co-op policy and works hard to follow it.

Agree on Who Will Take the Lead When

There are a lot of people involved during the selling process — contractors, builders, selling agents, buyers’ agents, and the buyers themselves. So at each stage of the selling process, it’s important to agree on who will take the lead.

A great example of this is when the builder’s representatives and the real estate agent walk through a property with a potential client. Who takes the lead when presenting the property?

In most cases, it’s wise for the builder’s agent to take the lead. They’re properly trained to showcase the home’s different features and amenities. However, the real estate agent should still have the freedom to ask questions that help their client make the right decision.


Don’t be fooled by the misconceptions. An effective home builder and real estate agent relationship is mutually beneficial.

It leads to higher profits, increased listings, and happier clients.

So remember to…

  • Build relationships through open-house events
  • Understand and follow the co-op policy
  • Agree on who takes the lead at each stage of the selling process

Another easy step builders and real estate agents can take to sell new homes under construction is using 3D home design software like Cedreo.

  • In as little as 2 hours you can make a detailed 3D model of a home.
  • Help clients get excited about the finished product.
  • Create 3D photorealistic images to post on your listings
  • The software is so user-friendly, anyone can use it to create professional 3D models.

With a FREE version, you’ve got nothing to lose. Join 1,000s of other housing professionals who use Cedreo to close more deals.