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Buyer
Negotiating Tips
Some
people are born negotiators.
They'd
negotiate the time of day if they
had the opportunity. Many people,
however, feel uncomfortable
negotiating. If you fall in the
second camp, think of a home
purchase negotiation as a dialogue
between you and the seller. It's a
forum for exchanging ideas with one
another to see if you can come to
mutually agreeable terms. If you
can: Great. You've bought a home. If
you can't: that's OK, too. You'll
find yourself another home and the
seller will find another buyer.
There
are many ways to negotiate a home
sale.
It's
hard to generalize because each
transaction is unique. But, in most
cases, a successful negotiation
involves give and take from both
parties. Keep in mind that you want
the sellers to feel good about
selling their home to you. You may
need their cooperation during the
transaction.
For
example, you may want to renegotiate
the purchase contract if your
inspections reveal unanticipated
defects. You'll stand a better
chance of successfully working
through these negotiations if you've
built good rapport with the sellers.
A cooperative, rather than
adversarial, stance usually produces
good results.
FIRST-TIME TIP:
In the
spirit of give and take, you may
want to plan your negotiation
strategy so that you give up
something you want in exchange for
the seller giving you something you
want.
For
instance, let's say you know that
the sellers prefer a short close,
and you think his price is a little
high. You might start the
negotiation offering a 60- or 90-day
close and a price that's a bit below
the top price you'll pay. When the
seller counters back with a 30-day
close, you can accept this if the
seller is willing to sell at your
price.
With
this strategy, it's effective to
save a bargaining chip, or two,
until a critical point in the
negotiation. That bargaining chip is
often your best price. You may be
willing to pay the seller's price if
he agrees to take care of some
deferred maintenance. In this case,
you would hold back on agreeing to
pay his price until the seller
agreed to make the necessary
repairs.
Another
strategy that can break an impasse
is the "either/or" approach. With
this strategy, you give the sellers
two options. They can take their
pick.
Suppose
you're locked into a lease that runs
4 more months, and costs you $2000 a
month. You can't afford to pay the
seller's asking price and make
double monthly payments for mortgage
and rent.
The
seller wants to close in 30 days;
you prefer 90 or 120. If the home is
fairly listed for $300,000, you
might offer to pay $300,000 with a
120-day close, or $294,000 with a
30-day close. The seller can choose.
By the way, it can further the
negotiations if the other party
understands your circumstances.
It helps
to plan out your negotiation
strategy in advance. Find out as
much about the seller's situation as
you can. Determine the highest price
you're willing to pay. Make a pact
with yourself to walk away from the
property if you have to
significantly overpay to get it.
Sometimes it's best to stand firm
during negotiations. Perhaps you've
negotiated to your best and final
price. You may want to lay your
cards on the table and let the other
party know this. There's no rule
that says you must counter with a
new price.
THE
CLOSING:
And
remember, all elements of the
purchase agreement are negotiable,
not just the price.
Article written by Dian Hymer
Dian Hymer is author of "House
Hunting, The Take-Along Workbook for
Home Buyers," and "Starting Out, The
Complete Home Buyer's Guide,"
Chronicle Books.
Distributed by Inman News Features |
