Know the market
Make sure your Realtor prepares a Comparative Market Analysis before you make an offer on a home. This analysis will give you a good idea about trends in the market, in your particular price range and the area in which you are currently looking. It will give you information such as the price per square foot, actual selling price vs. listing price, and how many homes are on the market in your price range. All of this information combined will help you determine how much bargaining power you will have when you are ready to make your offer. If the market is moving quickly, you may have to pay near-list, list, or above list price to get the property. If the market is moving slowly, you may be able to offer something below list price and have the seller meet you somewhere in the middle. The bottom line is this: What you offer and what the seller will accept depends on the strength of the market and the desperation of the seller.
Representation
Make sure that the person helping to negotiate your contract is on your side! Realtors have specific designations to let you know whom they actually represent. Your Realtor should explain these various designations to you before you enter into the process of finding a home. It is wise to make sure the agent that you are working with is a Buyer’s Agent, as your best interests will be at the heart of your Realtors’ contract suggestions.
Everything is negotiable
Price, closing date, personal items are all negotiable when buying a home. Trust your Realtor during this process. There are, however, some things you should keep in mind:
If you want a specific closing date and the seller wants another, perhaps 30 or 60 days apart, try to come to an agreement, but you may want to get something in return. Examine the contract with your Realtor and determine exactly what stays with the home and what doesn’t. Typically, the items that stay in the house are the items that are “built-in,” such as the dishwasher, garbage disposal, etc. If there are personal items in the home that you would like to have, discuss negotiating them as part of the contract. The refrigerator? The washer and dryer? The TV that fits perfectly into the custom entertainment center? What about the swing set in the back yard? Ask for it! Remember, if you ask for something and the seller agrees to it, he or she may expect something in return or even raise the sales price to include the item.
If you want a specific closing date and the seller wants another, perhaps 30 or 60 days apart, try to come to an agreement, but you may want to get something in return. Examine the contract with your Realtor and determine exactly what stays with the home and what doesn’t. Typically, the items that stay in the house are the items that are “built-in,” such as the dishwasher, garbage disposal, etc. If there are personal items in the home that you would like to have, discuss negotiating them as part of the contract. The refrigerator? The washer and dryer? The TV that fits perfectly into the custom entertainment center? What about the swing set in the back yard? Ask for it! Remember, if you ask for something and the seller agrees to it, he or she may expect something in return or even raise the sales price to include the item.
Be reasonable
Buying or selling a home can be a stressful event. During this time, there will be a lot of give and take. When negotiating an item in the contract, decide first if it is a “must have” or a “nice to have.” If it is a “must have,” then determine your walk-away point. If it is a “nice to have,” don’t spend a lot of your energy and the energy of your Realtor if you aren’t having any luck. Instead, focus your energy on the important items.
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