Home Buying Negotiation Tips

Did you know that most sellers list their homes with full expectations of a buyer negotiation? It’s almost an unspoken rule in the buying process. While the fluctuations in the market with supply and demand can alter the effect of negotiations, it’s still common to negotiate to some rate. You may be wondering why it’s important to negotiate the home price. The driving factor of home list price is equity – so while the home seller wants to maximize their equity and profit potential, as the buyer, you want to do the same. Therefore, you want to buy a listed home at a fair and reasonable price – comparatively speaking in the current market. So, while your agent will undoubtedly go to bat for you and guide you in how or what to negotiate when making your offer, it’s wise to know a bit about the process ahead of time. So you can haggle like a pro, we will share a few of our top home buying negotiation tips.

Things to Consider Before Negotiating

The most important thing to understand before negotiating is whether you’re in a buyer or seller’s market. If you’re in a seller’s market, and the home you’re interested in also has several other bids, there is less room to negotiate. Therefore, chances are you will have to submit a higher offer from the get-go in situations like this. However, if there is a home that has been sitting on the market for a while, there may be more room to negotiate on the price. This is just the tip of the iceberg for factors determining how much you can negotiate and why an agent is invaluable here. Your agent will be able to assess the local market and better guide you in negotiation strategies before even beginning your home search.

Tips

Find the right agent

It’s especially true that first-time homebuyers should work with a real estate agent, but it’s genuinely invaluable no matter how seasoned you are. Agents can provide insider knowledge, speak with the seller agent, and are experts in their local regions’ housing market. This is all essential when deciding on what or how to negotiate.

Assess Housing Marketing

Knowing whether you’re in a hot or cold market will determine your negotiating strategy. For example, if the market is a seller’s market, you won’t have as much wiggle room as you would a buyer’s market. On the other hand, if there is a lot of interest in the home you want, you may need to offer over the asking price or increase your earnest money.

Be Ready to Haggle

On both sides of the process, it’s fully expected to haggle some. When you make an offer, you want to get the best deal possible. This can mean going back and forth until an offer is accepted and the lines are signed. Negotiations start at the first offer but can include closing costs and home repairs.

Have all finances ready

You won’t have much negotiating power if your finances are arranged propr to house-hunting. The bare minimum is to have the pre-approval letter in hand, but the more you can prepare, the better. Having cash ready for a sizeable downpayment and earnest money can be a huge advantage when negotiating.

Complete an Inspection

An Inspection can be the cornerstone of negotiations. Once you have the report in hand, you can ask the seller for concessions if anything negative is revealed in the report. You may also want to ask the seller to lower the asking price, fix the issues, or even give a closing cost credit. If the inspection results are a deal-breaker for you, this is also an opportunity to walk away from the home.

The Bottom Line

Home negotiating is a lot more intimidating than it sounds, but the right agent will be able to assist you through the whole process. If you’re ready to take the next step and talk to an agent, we’d love to chat. Give us a call or schedule a buyer’s consultation here.