You’ve done all your research. You’ve shopped around. At last, you’ve found your dream home. The only problem: the seller’s price is above your ideal price range. This can be by far the most difficult stage in the home buying process—the negotiation stage. No need to fear, however. This is one area where an experienced agent can help you get the best deal.
Knowledge is Power
One thing your agent can help with is gathering information for you to learn as much as possible about the seller’s motivation for selling the home. Do they need to do so in a hurry? For example, if a new job in another state is behind their reason for selling, they may be much more motivated to negotiate with you since they likely need to tie up loose ends quickly so they can focus on beginning the new job and getting settled in a new location.
Get the Facts
Sometimes just knowing some of the basic stats can sway the sellers toward your offer. You and/or your agent may have done much of this in the beginning stages while you were researching neighborhoods. Leverage your offer by comparing the asking price to the selling prices of similar homes in the same area. These comparables, as they’re called (or comps) include other factors such as the original selling price of similar homes versus their selling price, as well as the number of days the home has been on the market. Knowing this information will help you determine what the fair market price of your potential home should be.
Get it in Writing
Your agent will prepare a written offer that he or she will present to the seller or the seller’s agent. You can build a strong case for your offer by including the relevant facts (this is where the comparables come in). You may also want to consider including a personal note from you when your agent makes your case to the seller. A short note relating your situation and your feelings about their home can make a favorable impression. Personal stories make connections, and a connection could make all the difference in the outcome.
Consider Giving and Receiving Concessions
This could be something as simple as being flexible on the closing date, especially if the seller is in a situation where there will be a gap between moving out and getting into their new place. Another concession you can make is to come with a pre-approval letter from your lender. This shows the seller you’re on solid ground financially, since it can be risky for them to make a transaction with a buyer who doesn’t have pre-approval.
Your real estate agent may also agree to the full asking price if the seller is willing to pay the closing costs or purchase a home warranty. Certain household items could even be included in the deal. Large appliances such as washers and dryers are often written into the final agreement.
Focus on the Goal
In the end, your purpose is to buy a house, not to out-maneuver the seller. This transaction can be a win-win for everyone involved. However, there are times when an agreement just can’t be reached. That’s okay, just have a back-up plan of other properties that will suit your needs. Being willing to walk away can be a powerful tool that could work to your benefit.