In every property transaction, there’s a buyer hoping to get the lowest price and a seller hoping to get the best price. Somewhere in between, is the tricky process of negotiating a deal that works for you. Where do you start and where do you stop?
The ability to conduct successful negotiations starts with being familiar with the market, down to the neighborhood and maybe even the street. Too many homes on the market with too few buyers and it’s a buyer’s market and there’s more room for negotiation.
But if there’s a shortage of homes, as is the case in many desirable neighborhoods, then the seller holds the advantages. This is where a good agent, with market knowledge and negotiating skills, can help close a successful purchase instead of a deal that falls apart.
Your home will probably be the single largest purchase that you’ll ever make and you need a trusted professional negotiating on your behalf. In most cases, buyers pay nothing to use an agent because real estate commissions are covered by the seller.
Here are 9 tips for negotiating successfully
- Get that all important pre-approval.
Offers that include a mortgage preapproval carry a lot more weight. Some top agents won’t show homes to buyers until they are preapproved.
- Offers should be based on the home value, not the list price.
Using the current sales in the neighborhood as a guide, you and your agent have ammunition and information. Knowing a house is priced at or below market value, you’re not likely to get it for less but if the price is above market value and it hasn’t sold yet, a lower offer accompanied by a market analysis may do the trick.
- Move fast when you find the right home.
When good properties go on the market, they sell quickly. In this case, make your first offer your best offer.
- There’s no harm in asking. Even in a tight market, you can still ask for repairs or other concessions, but you may not get it all. Wait until the end of the inspection period to make your requests. Remember, if you don’t ask, you don’t get!
- Find out as much as you can about the seller. The more you know, the better you can tailor your offer. Is there a divorce involved? Does the seller have a new place already and want a quick closing? You’ll need to ask a lot of questions of the listing agent and the seller but the more you know here, the better negotiating strategy you can put together.
- Online real estate listings and the public records will help your research. Use these tools to get information about the seller, the property and the neighborhood. Is the house in foreclosure? Is the seller party to a divorce proceeding?
- 7. Anticipate having to compromise. You aren’t likely to find a perfect house so be willing to compromise on features. . Go into the negotiating process prepared to compromise, and you’ll be a step ahead.
- Don’t sweat the small stuff. Many things about a house can be easily changed, including appliances, countertops, carpeting and dated window treatments. Let the little things go.
- Make your offer personal by including a letter to the seller. A letter and even photos of the potential buyers puts a face and a picture and tells a story. It’s human to want your home to go to someone who’ll enjoy the property as much as you have.