The energy of searching for your dream home is undeniable—open houses are full of opportunities, home tours inspire images of your potential life within those walls, and finally finding the perfect one can spur excitement like nothing else.
But tucked between the exhilaration of house hunting and signing on the dotted line is a vital step that can be nerve-racking: negotiation.
Negotiating the best possible price on your new house can be a complicated web to navigate, especially, especially in a seller’s market when buyers may offer up to 24 percent above asking. But if you equip yourself with the appropriate tactics enlist the expertise of your trusted real estate agent, and carry a cool, collected demeanor, you can turn the process from a tense experience into a smooth ride that ends with the keys to your new home in your hands.
Apply for preapproval
One of the first steps of the house hunting process is getting preapproved for a mortgage. Not only can it provide a clear limit on what houses to search for, but it will also give you a clear understanding of your upper constraints when negotiating and how much leverage you may have. Furthermore, having a preapproval letter, particularly one that’s fully underwritten, shows sellers your financial capability and seriousness as a buyer, strengthening your position in negotiations.
Conduct market research
Beyond preapproval, knowledge may be your best weapon in negotiations. Look into similar properties recently sold in the same area resembling the one you are considering, taking note of the sales price along with what factors may have impacted it, including square footage, features, and even the number days spent on the market. This information will give you a gauge of the actual market value of your target property, which will help you create a strong, well-informed initial offer.
In addition, assess the state of the current market. Is it a buyer’s market, in which homes sit for months and sellers are more accommodating? Alternatively, is it a seller’s market, in which several offers are the standard and bidding wars break out? Knowing these dynamics lets you tailor your negotiating approach accordingly; in the former, you might be freer to demand repairs or lower prices, while in the latter, you’ll want to stress your preapproval and ability to provide a fast closing to appeal to the seller.
You can certainly peruse resources like Zillow and Realtor.com to glean some of this information, but just keep in mind that their pricing details in particular can vary widely. As such, rely on your agent heavily for this step; they can give you competitive comps in an area and have their finger on the pulse of market trends.
Communicate
More often than not, sellers are emotionally tied to their homes—they have created treasured memories, observed holidays, and raised families inside those walls. For this reason, making a personal connection with the seller will help you further down the road. Consider writing a letter to the seller in which you express your interest in their home and show sincere gratitude for the special qualities of the property, such as the sunroom, the well-kept landscaping, or the lovely original hardwood flooring. This builds respect and may nudge the seller toward a more flexible agreement. And knowing their beloved house will be going to someone who really values it, they may even consider a somewhat lower price.
Be ready to walk
It’s no surprise that the seller wants the best deal, just as you do. Should negotiations turn unreasonable, such as if the seller is asking far above market value and refusing to budge, don’t hesitate to leave. You have the advantage by having plenty of other options of homes, while they only have one home to sell. Plus, knowing you’re ready to walk may push the seller toward a compromise fit for both sides. If they see you are a serious buyer who won’t be pressured into an overpriced purchase, they may be more likely to accept your offer.
Work with your real estate agent
As important as it is to shore up your own negotiating skills, make sure to also rely on your real estate agent—negotiations are where they shine. After all, they are equipped with expertise navigating the subtleties of the local market and its complexities. They will help translate the occasionally cryptic language of sellers and negotiations while assisting you in creating a winning offer. Their knowledge can make all the difference between missing out on the ideal opportunity and ensuring your dream house at a reasonable price.
コメント