Negotiating 101

If you are a buyer, with money to spend, no home to sell, and are pre-approved for a loan...lucky you! Your timing is great. The market is flooded with homes for sale, most homeowners realize that they cannot over-price their homes, and interest rates are as low as I ever remember. Negotiations can be tricky, so before you begin, here are some tips to consider.

1. Homework. Your Realtor will get you all this information.
What are the prices of comparable homes in the area?
What is the typical length of time those houses were on the market?
How many days has your "target" home been on the market?

2. Get to know the Seller's motivation. The seller or their agent may not tell you, but you can always ask.
What are the pressures on the seller of this home? A highly motivated seller will be far more willing to negotiate.

3. Keep your motivation to yourself.
Are you paying cash? If the sellers know this, they may think you are a person of means and can afford to pay a higher price.
Have the sellers overheard you walking around the house decorating?
Have you visited the home on several occasions, measuring and taking pictures? Visit twice at the most. Be prepared when you are at the first showing!

4. Have more than one choice for a home. Buying real estate is a huge purchase and should be treated as an investment, similar to purchasing stocks.
Do you have a back-up house?
Are you "in love" with the home? Never negotiate with your emotions. Use your head!
Have you tactfully let the sellers know that you are considering several properties?

5. Ego can kill a purchase.
Do you have a reasonable and flexible price range for the home? Sometimes buyers get so involved in the negotiations that they lose sight of the ultimate goal; to buy and move into the home of your choice. If this is the house you have chosen and you feel that the price is fair, don't let a thousand dollars prevent you from buying. I have seen buyers lose the house of their dreams because they got caught up in the process of negotiating and let their ego get in the way. The price may be a bit more than you hoped for, but if it is in your budget, and you feel the house is worth the money, strongly consider if you are willing to give a little.