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Negotiating a Sale
You are ready to put in an offer to purchase the home of your
dreams. So how much do you offer the seller?! And is it really how
much you offer or how you offer it?
Reasonable Market Price
Before doing anything else you need to know what a reasonable market
price is for the home you hope to buy. Have your real estate agent
run a Comparable Market Analysis for you on similar homes that have
sold in the last year in your target neighborhood. Although an
appraiser will only use the last six months of comparable sales when
figuring appraisal value, it is helpful to have a more overall trend
for the neighborhood to determine that prices are rising and that
your investment will be protected in the long run.
Your Price
Then you must figure out what YOU are willing to pay for this home.
If you are willing to pay market value or more for this home because
you don’t want to risk losing it, please let your agent know up
front! Most good agents will try and negotiate a below market sales
price for you because they want to please you and retain you as a
future client. But only you can determine how you might feel if you
lost this home to another buyer for a few thousand dollars!
Seller Motivation
You must try and determine what is most important to your particular
seller. If possible try and find out the answer to why he is selling
his home. It may give you some insight as to what he is or is not
willing to take or where he is willing to make a trade off. Although
this may sound obvious, sometimes the reason "why" may not lead to
the sales price you would expect. Major factors in a seller’s
willingness to bargain may be the length of time the house has been
on the market, a death in a family, job instability, homesickness,
etc. Once you have determined the seller’s probable motivation then
it is time to position yourself so that you can give the seller most
of what he wants so that you can get what you want - the lowest
possible price!
Improve Your Negotiating Position
Don’t show emotion when previewing the home. Be polite, but if you
let the seller know what you are really thinking it doesn’t matter
what else you do! He knows he’s got you hooked.
Get totally loan approved. A pre-approved buyer (not just
pre-qualified) is almost as strong as a cash buyer. And if you are
totally certain of your ability to obtain the necessary financing
you may even want to remove all financing contingencies except
appraisal so that you are exactly like a cash buyer. By letting the
seller know that you are willing to risk your earnest deposit in
this fashion he can assured you are serious and confident of a
timely closing. And if you can be flexible about moving dates that
may also be a main factor in the seller’s decision to take less than
he really wanted.
Key Tactic
The final step is to "guess" what the seller was "hoping" to get,
based on the information you have gathered about the seller and the
property. If you offer too low he may be insulted and retaliate in
kind on his counter offer. The key is to try and figure out an
amount that is slightly less than what he was hoping to get, but
that is close enough that he gets more nervous about losing a
possible sale and a strong buyer than he is about lowering his sales
price.
Remember, while your agent can advise you on possibilities, the
ultimate decision on what to offer is yours. But if you use the
above techniques you should almost always be able to negotiate a
better than average deal!
Article by Diann E. Tonnesen, Realtor®
Las Vegas Homes
Las Vegas High Rise Condos
Las Vegas Country Club Homes
Henderson Real Estate
This article is copy write protected and may only be reprinted with
permission of the author. Any use of this article without express
written permission of the author will be prosecuted to the fullest
extent allowed by law.
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