Negotiating to buy a home
October 10, 2011
When negotiating, home buyers should have a good real estate agent to rely on. Even with an advisor, however, it can help to have some idea of what to expect beforehand so that home buyers and their agents can work together to secure the best possible deal for the right property.
An experienced agent has seen home sellers many times before, and can help the buyers understand what a seller's attitude means. Learning about the seller without giving away information can strengthen a negotiating position, allowing adjustments to the particular circumstances of the transaction.
Picky about prices
Negotiating home prices is tricky. Home sellers do not want to accept too little as a practical matter, and frequently have emotional attachment to the house that makes it seem like it should have more value than it does.
Home buyers should be careful when calculating their price range. What matters is not how much they "should" be willing to pay, but how much they actually are willing to pay. If an amount is too high for them, they should be clear with their agent from the start to avoid wasting anyone's time - including their own.
Another factor is the terms of the deal. Closing costs, furniture, landscaping equipment and other items or services can also be negotiating points, and a home seller unwilling to budge below his price point might not mind a few concessions on peripheral questions.
An expert told Fox Business people make several common mistakes when
inexperienced in negotiations. Some dig in too firmly, and are unprepared to take no for an answer. This can turn a conversation into a confrontation and test of wills, derailing negotiations.
Another flaw is to do the opposite, trying so hard to appeal to the other party that the negotiator gives up important points. Home buyers willing to offer something other than money, such as a timely closing, need to convey the value of such a concession.
According to Mint.com, one error both home sellers and home buyers sometimes fall prey to is issuing ultimatums. This is a quick way to end open discussion and turn the other party hostile, and may finish any chance of closing a deal even if the amount being offered is reasonable.