Large-production homebuilders now account for nearly two-thirds of all new-home sales. But there are signs many of them, and even their smaller brethren, have gotten too far out over their skis.

According to one report based on U.S. Census Bureau data, the inventory of completed but unsold houses has more than doubled over the last decade, and now sits at a 16-year high. Some 124,000 finished houses are sitting there, empty -- and draining their builders’ balance sheets.

Not to point a finger at any particular builder, but the United Homes Group is a case in point. The company ended the third quarter with 264 homes in backlog and 413 “spec” homes under construction. Orders -- that is, signed contracts -- declined over the first nine months of this year, yet the builder started 66% more houses in the third quarter.

“Elevated new-home inventory levels continue to drive competition for new sales activity across our markets, and as a result we are not immune to the industry-wide pressures affecting other homebuilders,” said CEO Jack Micenko during a recent earnings call.

And therein lies an unprecedented opportunity for buyers to snap up brand-new houses at bargain prices.

As previously reported here, builders are doing practically anything to move product, from drastically cutting prices, sometimes by as much as $100,000, to offering incentives from cheaper mortgage rates to free upgrades. Some are even throwing in an automobile, a vacation package or a free golf cart.

Lennar, one of the country’s largest builders, has gone so far as to add a tab on its website to help investors find more than 2,000 of its houses that it considers rental-ready. The company says these “investment-friendly” properties are in 90-plus locations nationwide. The builder says they are attractive to seasoned investors as well as those new to the real estate market. Lennar promises investors “end-to-end purchasing support,” including pre-negotiated financing, property management, insurance and title services through its affiliates.

In another case, news and research site ResiClub is helping its members find investment properties. While there’s no definitive market-by-market breakdown of where the inventory exists, the company believes much of it is likely in the West and in the Sun Belt, particularly around the Gulf.

Members can look for county- or ZIP code-level markets in the Sun Belt, say, then drill down to specific locations where house prices are declining -- a sure sign of market softness. Then, the “Public Home Builders” tab will list which giant builders are active in members’ target markets.

“That’ll give you a starting point to figure out which homebuilders might be eager in those markets to discount in order to move (inventory),” the company says.

While giveaways may be enticing, bargain-hunting buyers should be careful which concessions they choose. Some are worth more than others. So you should ask questions -- lots of them.

Take “buydowns,” in which builders pay lenders a fee upfront to lower their rates. But how long does the lower rate last? A year? Two years? Obviously, the longer, the better, so ask -- and then try to get the builder to extend it a little longer. A few builders are going the whole nine yards by buying down the rate for the entire term of the mortgage.

Another popular but tricky concession category is free, or deeply discounted, options and upgrades. Some builders offer thousands of dollars' worth of upgraded appliances, countertops and cabinetry, for example. But are you really receiving as much value as you think?

Builders often mark up their extras, sometimes by as much as 100%. So if they say the refrigerator you are getting is worth, say, $4,000, it might have only cost them $2,500.

Here, try to get your builder to up the ante. Or at least ask what their cost was before you sign a contract. Another tactic would be to price out the upgraded kitchen cabinets on your own to see what kind of deal you are really getting.

In many large-scale communities, builders are offering free golf and swim club memberships. But again, for how long? A few years, or for as long as you own the house? It’s worth asking and trying to get the grace period extended. After all, memberships can be costly.

And speaking of memberships, find out what the monthly or quarterly dues are for the community’s owners association, and what services are covered. Landscaping? Golf? Snow Removal? Some utilities?

There’s nothing you can do about homeowners association dues other than to get the builder to pay them on your behalf for a period of time. Every buyer in the project has to join, whether they use the amenities or not. And the cost can eat you up.

Finally, some of the best deals are tied to completed houses, so you may not nail the lot of your choice. The houses with the best perks may be on the worst lots in the community. But it’s worth a shot to ask what the builder is willing to do for you on other sites. They already know you are interested, so they might be amenable to making a deal to keep you on the hook.

[EDITORS: This is the second column in a two-part series.]

Homebuyers looking to pay their agents directly have found little success, according to a new consumer group study.

Instead, buyers are being told not to worry -- that the seller would pay the commission. Some are being told that buyers never pay any agent fees, just sellers.

That’s not what was supposed to happen as a result of two landmark antitrust lawsuits, settled a year ago, between disgruntled homebuyers, the National Association of Realtors and several large brokerages.

Under the new compensation rules put in place because of the class-action cases, sellers and their agents were no longer required to post how they intended to pay agents who were working with buyers. Also, before being shown any houses, agents are now required to have buyers sign a contract that includes how, and how much, the agents will be paid for their services.

It was hoped that both steps would “uncouple” buy- and sell-side commissions, allow for more negotiation over sales fees on both sides of the table and eventually lead to lower costs for both buyers and sellers.

For the most part, though, it’s pretty much business as usual, per a report by the Consumer Policy Center, an independent think tank.

Removing the barriers to negotiation “was not sufficient” to move the needle, according to the report’s authors, CPC Senior Fellow Stephen Brobeck and Fellow Wendy Gilch.

The reason: The real estate profession has found ways to minimize the settlements’ impact.

While attempts to negotiate "might increase" as buyers and sellers learn about the new regulations, Brobeck and Gilch write that "it has become increasingly apparent that successful agent work-arounds have greatly limited these opportunities. Buyers are still assured by most agents that sellers will pay their commissions.”

Other studies have found similar results, and other groups agree that commission rates have barely budged since the NAR settlements. But the CPC was the first to take a ground-level look at what’s actually happening in the realty trenches.

To wit, CPC’s researchers mystery-shopped 281 buy-side agents from "the most active brokerages in 26 diverse metro areas."

They found it “very difficult” for buyers to bargain lower fees, with those who try being “met with a barrage of arguments.” Typical excuses included insisting that most sellers in a particular market pay the commissions, or that buyers are never expected to pay these fees.

Buyers are also often told that if the seller and their agent don’t pay the buyer-agent’s share, buyer-agents won’t show their houses. “Typically sellers pay because they don’t want to be at a disadvantage,” is a frequent refrain.

Based on these findings, Brobeck and Gilch believe the presettlement goal of truly separating commissions “should be revived and prioritized.”

They also call for allowing buyers to include agents' commissions in their mortgages, calling it “the most practical mechanism” for driving down costs. Right now, federal regulators do not allow borrowers to finance sales commissions, even though it is generally accepted that sellers include their fees in their selling prices.

Until lenders are permitted to include commission charges as part of the loan amount, buyers are on their own in trying to negotiate what their agents charge. But they should not take no for answer.

Interviews with the agents revealed that while they resisted at first, they were willing to bargain when faced with pushback. A full two-thirds said they would accept a lower fee, and of those, a third would agree to lower their fee by a full percentage point.

If your agent balks, find another one who is more amenable to cutting their levy -- at least a little.

Sellers also should try to negotiate their side of the commission, but Brobeck and Gilch advise against offering a specific percentage. Instead, sellers should just indicate they want to bargain.

Researchers also found that a number of agents ignored the requirement calling on them to have buyers sign contracts before showing them the first property, with some saying it wasn’t necessary.

There’s nothing inherently wrong with these contracts, but buyers should be careful of their terms. Some tie you to the agent for months, while others allow the broker to turn you over to another agent if you are dissatisfied with the original one.

However, rather than signing formal agreements, nearly half of the agents interviewed said they would offer short-term “touring” contracts, which could be terminated without penalty if you became unhappy with the agent's services.

Meanwhile, industry practices remain a fertile ground for more class-action suits, the CPC report warns, if only because agents and their brokers all tend to charge the same rate. Some 95% of the agents interviewed quoted a commission between 2.5% and 3%, with nearly three times as many citing the higher figure.

“The continuing uniformity of rates provides prima-facie evidence of price fixing and an easy, tempting target for critics,” reads the CPC report.

Interestingly, all agents quoted their fees as a percentage rather than as a fixed dollar amount. Some believe that if commissions were presented in flat monetary terms, buyers and sellers alike would realize how much they are spending -- and would be more likely to try to bargain those fees down.

The supposedly “earthshaking” legal settlement that was supposed to drive down real estate commissions, saving buyers and sellers thousands of dollars in the process, wasn’t so tumultuous after all.

Twelve months after the National Association of Realtors agreed to change the rules on how agents are paid, commission rates are roughly the same as they were prior to the settlement. That's according to research from RISMedia, a news service for real estate agents and brokers, which polled 623 real estate professionals on the topic.

Immediately after the settlement, rates dropped sharply. But now, based on a full year of data, the company says commissions did "snap back from their initial plunge."

Sales fees are still down a bit, averaging roughly 5.39% on a national basis. But they “remain within a historically normal range of year-to-year fluctuations,” RISMedia found.

Steve Brobeck, senior fellow at the Consumer Policy Center, is among those who thought the NAR deal would bring down real estate fees.

While the settlement called for greater buyer and seller negotiation of the buyer's agent's share, Brobeck believes some agents have “effectively used ‘work-arounds’ to thwart any negotiation that lowers overall rates.”

“Buyer efforts to negotiate lower rates are typically met with a barrage of arguments that begin with the statement that sellers compensate buyer agents and end with a promise to write a 0% rate into the buyer-agent contract,” he told me.

Brobeck often laments the fact that those who are relatively new to real estate sales are paid the same rates as experienced agents. The RISMedia poll found that that hasn’t changed, either.

For agents on both sides of the table, the difference in average commission rates was negligible between those who claimed industry experience of 10 years or more, and those with less than 10 years. Just after the NAR settlement, RISMedia found, less-experienced buyer’s agents were charging an average of 2.1% of the contract price for their services, while their more experienced counterparts were charging 2.33%.

Now, both groups have seen their average commission rates “return to the norm.”

This finding is at odds with what critics thought would happen. The trend is similar for listing agents, although those fees haven’t gone up quite as much as the buyer-side's.

Percentage changes might not mean a lot to buyers and sellers. But when presented in monetary terms, they are significant.

For a newer buyer-side agent, the 0.47% commission rebound represents $1,930 more per transaction on a median-priced house. For a buyer-side agent closing the median number of sales annually, the increase works out to just over $23,000.

Sellers, meanwhile, are paying $1,027 more on average per deal, which works out to an extra $12,324 in the pockets of agents who list and sell the median number of houses per year.

Again, that’s money out of sellers' pockets.

The NAR settlement was thought to be a game-changer in the way agents are paid. But that hasn’t happened, either.

Prior to the agreement, the seller generally paid their agent, who split the commission with the buyer’s agent. But the pact cut the two agents loose from one another, giving buyers the opportunity to negotiate their share of the commission with their own agents.

According to RISMedia’s research, in the early weeks of the settlement, 71% of the agents queried said sellers always paid the levy. Now, 78% say that’s the way it works.

This is “not quite matching the 86% of agents who saw this cooperative compensation pre-settlement, but (it's) still a notable rebound,” the company says.

More surprising, perhaps, is that just 2% of the sampled agents said the buyer paid their own agent in each of their transactions over the previous 12 months. And 95% said half or more of their deals involved cooperative compensation.

If that finding is not in direct violation of the NAR settlement, it is in violation of its spirit.

The report notes that multiple listing services that are not affiliated with NAR still allow listing agents to post what part of their commission they are willing to give the buyer’s agent -- a practice the settlement forbids.

In addition, some agents are modifying buyer-agent contracts to obtain additional compensation offered by a seller. And some listing agents are keeping excess commissions that are paid to the buyer’s agent.

The latter practice “is perfectly acceptable under the new rules,” the media company says. But it’s also a practice critics see as "evidence of underhanded and anti-consumer behavior."

The research shows that these practices "are at least somewhat common in the post-settlement world -- across brokerage models, regions and demographics."

On a brighter note, more and more buyers are signing contracts with their agents and detailing, among other things, what they will be paid. That, says the media company, “would appear to affirm both the practical implementation (of the settlement) and NAR’s argument that these agreements are an important and positive development.”

Another shift that some expected to emerge from the settlement was that agents -- particularly buyer-side agents -- would work for a flat fee or under a fee-for-service platform. But a full year after the settlement, the study found no significant movement on that front.

NEXT WEEK: Agents still refuse to bargain.