If you are planning on purchasing a property, you may not want it at the actual price that it’s going for. So it may be a smart idea to negotiate it down to the right price that you consider affordable. This guide will show you the top ten strategies that you can use so both you and the seller will be happy when the deal is said and done.
You can purchase a property and call it the home of your dreams. It starts with finding a realtor that you can trust. Learn more about Teifke Real Estate and what they can do for you in finding a home at the price that you want.
Let’s take a look now at the following tips:
1. Be ready to counteroffer
When you have a counteroffer, that’s when the negotiation starts. However, this is going to depend on the market and where it swings in favor of. For example, a buyer’s market will focus more on a price that is lower than what’s listed.
In a seller’s market, it’s about getting the best price no matter what. You’ll want to keep the negotiations going until an agreement is reached. One thing that you may need to keep intact is your intention to pay the closing cost instead of the seller (that can be negotiated as well).
2. What are the current market conditions? Know them
The market conditions will play a role in how your negotiations go. Remember, it can either be a buyer or seller market. A buyer’s market will give you more leverage in making a lower offer.
Sellers will be more than happy to get the property out of their way and accept the offer right then and there. But in a seller’s market, they won’t be so easy to let it go at a low price. Not to mention, they may have more buyers other than yourself.
3. Get pre-approved for a mortgage
If you are pre-approved for a mortgage, you can be sure that the game could lean in your favour. Pre-approval will ensure that you have the financial standing to get the house you want to buy. It will also narrow down your options as well based on your financial situation (and the needs and preferences that fit).
4. Work with a real estate agent you can trust
Trust is a huge factor when it comes to working with real estate agents. You want one that will have your best interests at heart. They earn commission for the sale, but you want someone that will get you into the house you want (not show you a house and ‘urge’ you to buy it so they can score quick cash).
5. Know your local market
Your local housing market will be a little different compared to the next town over. But it’s important to have the right kind of knowledge. Again, you’ll need to know that the market in general is leveraged towards buyers or sellers.
Once you have the right kind of intel, this will give you more preparation to make a decision on an offer. In a buyer’s market, you will have the advantage. But in a seller’s market, this will take a bit of time and maybe creativity.
6. Get information on why the seller wants to move
There’s a reason why the home seller wants to move. They may be looking for a new home that may be smaller. They might have a new job in a different part of the country.
Once you know the reason, factor that into your negotiation plans. If it sounds like they need to get out and fast, they might take any offer you throw their way. But don’t take that as a sign of a low-ball offer.
They may not mind paying less than the listing price. But they have their ‘floor’, a price to where they can go as low as they can.
7. Offer something in return
If you do go for an offer that is lower than the original price, be willing to offer something in return. This may include covering any additional costs that the seller would otherwise take care of. It’s also important to know the terms the seller is looking for.
For example, if they want to close the deal and fast, give them that offer along with what price you are negotiating.
8. Inspect before you decide
You’ll want to get the house inspected before a deal is ever made. This will give sellers the responsibility to find someone who will be able to go around and check to see if everything is in good shape. After the inspection, both you and the seller will get a report.
At that point, you can purchase the home as-is, but throw in a lower price. You may need to keep extra money to fix the place up yourself. Otherwise, you can get the seller to fix the issues if they want to close it at the listing price or higher.
It may also help to consider home insurance in case things go south after you’ve moved in. That way, you’ll be protected for the happenings that happen beyond your control.
9. Talk to the seller about how important the house is to you
The seller has an important reason why they are selling. You have one as to why you’re buying it. Meet the seller and talk about why the home you want to buy from them might be their best option.
Talk about how it’s close to other family members or if it’s great for you because of the commute to and from work. Whatever it is, let them know.
Get to know the seller and talk about some commonalities you may have. This can create a connection of trust.
10. Know that negotiation is a win-win, not win-lose
You want to be happy with your end of the deal. They want to be happy with theirs. So negotiate on terms that you both may be happy with.
This can be a challenge. But it can be done if you both take your time. If that doesn’t work, you may need to apply this next strategy.
Know when to walk away
Sometimes, the agreement will never happen for one reason or another. The seller may be firm on some terms. And something may not seem right on your end.
It’s important to use your instincts and know when to walk away. It’s not the end of the world if you decide not to settle on the house that you thought would be the home of your dreams. Sometimes, it can happen and an opportunity to purchase something better will start to appear.
