7 Essential Home Buying Negotiation Tips

Written by on May 21, 2013 in Money - No comments | Print this page

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Home for saleMaking a home purchase is quite challenging and you have to be smart during negotiations so as to get a good deal.

Here are 7 essential home buying negotiation tips that will make the whole process easier.

1. Be Fast On the Uptake
During negotiations, it is essential to respond to counteroffers fast and to avoid making counteroffers using any terms that are not actually a deal breaker.

Delayed responses leave an open space for other buyers to interrupt and create a bidding battle. This could also lead the seller into perceiving that other serious buyers may be out there.

2. Cut In the Middle Man
Whenever you want to tell or ask something from the seller, always use your real estate agent to communicate your concern or request to the seller’s agent. While this might seem ineffective, it is not a good move to directly contact the seller. Remember, the terminology is difficult to master as well as legally sensitive. Using your agent is important.

3. Gauge the State Of Affairs When Dealing With a Builder/Developer
When buying a newly built house, lots of this talk about price and terms and negotiating might be moot. In such cases, the developer/builder dictates their selling terms for the home, and you do not have much of a say on that.

You pay the list price, but in many markets, builders and developers are ready for negotiations if they have a big amount of inventory.


4. Obtain the Dirt on Pendings
It is important to know how much buyers of other similar properties in the area paid for their property. This information can be obtained from real estate agents, if sweet-talked. You could have your real estate agent contact them, elucidate the situation and ask indirectly for contract price hints.

You can also tell if the property sold for its asking price by looking at how long it stayed on the market. If it stayed on the market for long, it is less likely to have sold for its asking price.

5. Check the Comps
Remember, the more money you are offering, the more probable the seller will accept. Since your agent is only paid if the home seller accepts, they are likely to emphasize or include the maximum priced comparable, even when they are not the most comparable comps for your property.

Therefore, it is important to ask your real estate agent for a CMA copy and full MLS listing particulars some of most similar comparables.

6. Make Your Agent Work for It
You need to have a good real estate agent to be successful with a certain property, especially if have competition from other wanna-be buyers for the property.

Hopefully you interviewed many real estate experts and hired a trustworthy one. Always communicate with your real estate agent to make sure you are in agreement in terms of deal breakers and expectations.

7. Crunch the Numbers

Before finalizing your decision on the amount to offer, let your mortgage dealer run a monthly expense on your price offer and estimate your insurance and property taxes.

This way, you get an ultimate check on the actual monthly and annual responsibilities you will incur in case your offer is accepted.

Steve has been in the property game for a long time now and he loves sharing his knowledge of real estate, financial markets, property and investing. During the day he helps first home buyers in WA build and own their own home.

Image courtesy of artur84/ FreeDigitalPhotos.net

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