Wishing for an easy purchase is like having no back-up weather plan for an outdoor wedding. Chances are everything will be seamless, but when it’s not, you need a plan. And the best plan involves understanding what your influence is in this process. One of the most essential steps is to know that negotiating is, to some extent, an expectation when securing the best price when buying a home.
Here’s a breakdown several different strategies and tactics you can employ to come out on the sunny side of this major life event:
Appraisal: Obtain an independent appraisal to assess the market value of the property. If the appraisal comes in lower than the asking price, it can provide leverage for negotiating a lower price.
Home inspection: Expect to conduct a thorough home inspection to identify any issues or necessary repairs. Use the inspection report as a basis for negotiating a lower price or requesting significant repairs or credits from the seller.
Closing costs: Understand the various closing costs involved in the transaction, such as title insurance, attorney fees, and property taxes. Negotiate with the seller to determine who will cover which closing costs, potentially transferring part of this financial burden to the seller.
Contingencies: Include appropriate contingencies in your offer, such as financing and home inspection contingencies. These give you the flexibility to renegotiate or part ways from the deal if certain conditions aren’t met. Remember that weather plan? This is it. If the deal ends up being a tornado, you lose nothing but your time and any inspection and appraisal costs.
Negotiation tactics: Employ effective negotiation tactics to maximize your chances of securing a favorable price. Some tactics include:
Start with a reasonable but lower offer to leave room for negotiation.
Justify your offer with solid market research, property condition, or comparable sales data. This is where your REALTOR® has great influence. Their job is to do the research so they can advise you appropriately.
Demonstrate your seriousness by showing pre-approved financing or a strong down payment. The advantage here is that, especially if you are a first-time home owner, you’ve just proven that you are a real buyer. That is attractive to sellers.
Remain patient and avoid getting emotionally attached to a particular property. And remember the market is the market. Be flexible and understand value. And don’t overextends on impulse.
Real estate market analysis: Conduct thorough research on the local real estate market to understand current trends, pricing patterns, and the competitiveness of the area. This knowledge will give you an advantage in negotiations. Again, a good REALTOR® is positioned to help you the most here. A REALTOR®, like those at the Yosha Snyder Group, are adept at looking for recent sales of similar properties in the neighborhood to determine the market value. Use these comparable sales as evidence to support your offer or counteroffer.
Counteroffers: Be prepared for counteroffers from the seller. Evaluate each counteroffer carefully and respond with a counter that aligns with your desired price and terms. Know your budget and your limit. Be patient: negotiations often involve multiple rounds of counteroffers until an agreement is reached.
Remember, negotiation is a dynamic process, and each situation is unique. Because it is so essential to the homebuying process, the Yosha Snyder Group wants to be your REALTOR® guidance throughout the negotiation process.