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Buyer tips:
You want to make every dollar count in the purchase of your home. And one way to make it happen is to employ sound negotiating tactics that make a difference between small cents and dynamic dollars.
So let’s cover steps you can take to negotiate a fair price with sellers and not leave money on the table. It’s perceived that price is often a major concern with sellers. In fact, a common seller’s lament is “We have to get our price because……” (I’m sure you can fill in the blank with statements you’ve heard).
But it’s really not the highest price sellers are after—it’s the greatest net proceeds from the sale. “Net” is determined by subtracting the seller’s closing costs and any outstanding loans, liens and other financial encumbrances from the sales price. A second way home buyers lose out when negotiating the purchase price is to make a low, often ridiculous first offer. Yes, I know, sellers sometimes do take less (even though it’s done far less often in the today’s strong seller’s market.) Put yourself in the seller’s position. How happy would you be in continuing negotiations with a buyer who had just insulted you and your property?
First offers set the stage for all other negotiations that follow. In fact, the seller may become enraged and refuse to make any counter offer back to you. Or if there is a counter offer, the seller might turn the tables and insult you by asking for a price higher than what the property’s listed for. (Yes, this does happen in a hot sellers’ market!) If you do make a lesser offer, be prepared to defend why; such as repairs to be made, etc. Sellers will be more willing to listen to a price cut if it’s rational and fair.
One last tip—earnest money does talk. When evaluating two offers side-by-side, the one bearing the heftiest amount of deposit gives the perception that the buyer is more serious about the property and is perhaps a better financial risk (even if it isn’t true!) This is an important tactic in a seller’s market where many buyers are vying for relatively few properties with multiple offers to the seller simultaneously.
When it comes to negotiating the purchase price of your home, neither buyer nor seller get to win all of the marbles! Decide how important purchase price is to you and negotiate with that priority in mind.
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