You’ve found the house you love and want to put in an offer. The asking price may be a little higher than what you feel you should pay for it, so you want to negotiate, bargain and win. How do you do it? Here’s how to win the negotiations when bidding on a home.
Get an appraisal and find out what the home is worth
Work with your real estate professional to find out the true value of the home, based on an appraisal or on recent sales in the area. Once you have that number, you can backup your offer with the truth about the home’s value and pay only what it was assessed to be worth.
In a hot market, you need to be prepared for competition. Have your deposit money in the bank, your mortgage preapproval printed and ready to submit with your offer and your down payment money ready to access. When sellers see you are prepared, they’ll know you are serious and may accept your offer over a higher offer because of it.
Wait it out
Homes that have been on the market for longer than a month may have lost a little value along the way. The longer a home is on the market, the higher the chances are that the sellers will be motivated, which means accepting lower offers than they would have in the first few weeks the home was for sale. If you are truly looking for a “deal”, ask your real estate agent to scout out homes that have been sitting on the market.
Find out why they are selling
In the same vein, finding out why a seller needs to move can let you know how motivated they are. If the reason is because of a divorce or if they’ve already bought another house, they may be ready to move on and accept your lowball offer. Get your real estate agent to do some digging before you put in your offer.
Give the sellers what they want
While you may not do that in terms of price, you may want to give the sellers everything else they want, including closing date, closing costs, home repairs, etc. If the house needs some work (as evidenced by the home inspection) and others want that work completed, they may feel like your offer lets them off the hook if you only ask for a lower selling price. Similarly, if they need to be out by a certain date and you can do that for them, that will be worth its weight in gold.
Buying a home is a delicate process, one where some tactics may work and others do not. It all depends on what the seller wants and how they want it.