Friday, May 2, 2014, PM | Leave Comment
Buying a new home is likely one of the biggest financial transactions you will make in your lifetime. The stakes are high, so it’s important that you get a quality deal and feel satisfied about the price you pay for your house.
When buying a home, you can get a great deal if you know how to negotiate properly, but if you go overboard, you might end up empty-handed.
If you’re not well-versed in the art of negotiation, read ahead for a few tips that can help you have the upper hand when you’re trying to get a good price on a home you like.
A lot of novice buyers make the mistake of starting negotiations with an unrealistic offer. If your offer is completely off the mark in relation to other homes in the area, the seller is probably going to refuse it outright. When this happens, the person making the offer loses the upper hand.
If the buyer comes back to make a second more reasonable offer, the seller knows that they are interested in the property. This makes them less likely to negotiate on the price.
If you are realistic from the get-go the seller will know that you respect them and will be more willing to work with you on price if they feel like you’re not trying to rob them blind.
Study The Market
Home buyers who are familiar with the local market have an advantage over other buyers. If you’re working with an agent, make sure that they know about what is going on in the neighborhood.
If you and your agent find comparable properties in the neighborhood that are selling for a lower price, then it’s easy to convince the seller that their price is too high.
You won’t be able to do much negotiating if you don’t know what the reasonable prices in the area are. Plus, doing research about the area shows the seller that you’re informed and won’t be duped into paying too much.
Find The Seller’s Motivation
Knowing the seller’s motivations can help home buyers negotiate a better deal. Do some research on the seller’s history; if you find that there are old offers on the property that have fallen through, the seller is more likely to negotiate on the home’s price.
Generally, when a listing just hits the market, the seller won’t be as willing to work with the buyer on lowering the price. If a home has been on the market for a long time, then the buyer has an advantage.
Offer Other Perks
When buying a home, you can offer the seller perks that might help them to budge on their price. For example, if you pay in cash, the homeowner is much more likely to negotiate on their price; they do this because they don’t have to wait for the mortgage to go through. Cash in hand is a very good incentive that most people won’t pass up.
When buying a home, it’s important to at least try and negotiate the selling price to make sure you aren’t getting ripped off. If you negotiate correctly, you can save a lot of money on your dream property and that money will go to other expenses that come with buying a new home.
Make sure to be careful with your negotiation tactics; if you’re too aggressive, you risk losing the home forever. Knowing the right way to approach the seller will help you appear as an interested buyer that wants a fair price for the home.
Having ample knowledge regarding the home and average asking prices in the neighborhood will help you make a winning argument and get the buyer to agree with your number.
This article was written by Dixie Somers, a freelance writer who loves to write for business, finance, women’s interests, and the home niches. She lives in Arizona with her husband and three beautiful daughters. Dixie got her advice for this article from Firestone home builders who specialize in building and designing homes, as well as helping home buyers with home financing in Colorado and several other regions.