For many inexperienced homebuyers, negotiating a final sale price can seem rather intimidating. Every homebuyer wants to make an offer most in their favor, which is why proper negotiation plays such an important role in the process. Here are four quick tips to help you get started on negotiations.
1. Understand the seller.
Perhaps the most important component of any negotiation, understanding your counterpart helps you estimate how much leverage you have and how low you can make an offer. If a seller is eager to sell the house as quickly as possible, you should stand firm in your negotiations and stress your willingness to buy the home immediately.
2. Research home prices in the area.
Before entering into any negotiation, you want to be sure that you have access to all useful information. In real estate, the average price of surrounding homes provides a reliable starting point for negotiations and helps you pick out houses that are listed well above market value.
3. Keep your options open.
All too often, first time homebuyers fall in love with a property and end up giving away far too much in the negotiation process. Instead of putting all your eggs in one basket, keep several options in mind. Not only will you avoid becoming locked in to one property, but letting the seller know about other properties of interest can give you leverage in a negotiation.
4. Don’t let ego get in the way.
By their very nature, negotiations require a certain level of competition between the two sides. As such, it is important to stay focused on buying a home at a favorable price and not let ego get in the way of common sense. Instead of insisting on a maximum price and risking losing the home, stay focused on the property itself and consider whether or not the price fits into your budget.