There is no better feeling than being able to buy a property on your terms. If you have been in the property buying process for some time, you must have already realized the importance as well as the complexity of the negotiation process. Working with a reliable real estate agent can save you the trouble entirely, but if you wish to be in charge of your property buying process, sound negotiation skills are what you must acquire.
As long as you know how to strategically enter into a negotiation discussion and then drive things in your direction, you are ready to negotiate. A good bargain is hard but once achieved, it increases the satisfaction of buying a property by several notches. Sadly, not many of us are natural negotiators which makes it even more important to learn the right negotiation tactics and there is no better way than learning from an experienced real estate agent.
Maintain your composure
First impressions are important and when it is about a real estate negotiation, a real estate agent is quick in reading your excitement and using it against you. No matter how pleased you are to find the property of your dreams, learn to hide your emotions. Overexcitement can prove lethal for the deal as it usually makes us talk more and listen less.
What you need to be are a better listener and a composed talker. This will save you from throwing cues about your feelings and losing the deal. You will be able to leverage the fear of the seller- losing you as a potential buyer.
Know your stuff; knowledge empowers your buying ability
Entering a negotiation with a sound understanding of the property, location, and features as well as makes you stronger. The seller might trick you with questions about the property comparable if you haven’t done your homework.
To be able to respond to the claims of the seller, you must gather information about the property. The more information you have the better comeback you make and even get an easy assurance of getting a good deal.
Always be prepared! Sometimes real estate negotiations go quickly and demand instant response. You do not want to be caught off-guard when it is about your dream property, do you?
Never show your cards first
When negotiating a deal, let the other party present their offer price first. Being the second one to present allows you to think and revise. A real estate agent with great experience would always try to get a price from the buyer first and then take time to come up with reasons to revise.
You must leverage this power and be the latter. Requesting the price over an email before you sit across a table to negotiate is the ideal approach to save yourself from not responding to the price offered in the first place.
Be realistic with your demands
For a buyer, it is natural to aim for the best property at a lower price. But being unrealistic disqualifies you as a credible buyer. The real estate agent would ask you for an offer price and even if you are the second one to quote, make sure you evaluate the property before quoting one. If you begin with a price that undervalues the property, the seller would be too disappointed to engage in the negotiation. The deal may even get called off before getting started. A good tactic is to quite offer a price a few notches lower than the listing price. However, you must check that the property is fairly priced in the first place and this can be done through research.
Know the reason for selling the house
A real estate agent always uses knowledge as the biggest tool when negotiating. Knowing the reason for selling the house plays a vital role in negotiating the price. You can easily negotiate if it is a foreclosure property. You may also find a property that is in the market for a long time because of the high listing price. In both cases, negotiation won’t offer you much and the deal may not have a lot to offer. It is best to dodge these categories and try for others.
Be flexible, it shows your willingness to negotiate
As much as you want to get the property within your budget let the seller know your desires are important. If you want your price to be accepted, make sure you present it paired with impressive settlement terms. Being too firm on the pricing will do better than harm. You can either get a perfect house or a perfect price. Bagging both is a complicated process that often ends with your dream getting thrashed.
Be willing to show your flexibility and be ready to compromise on the location, features, size as well as price. If you choose to be flexible you will find yourself closer to concluding a successful deal.
Never show it’s your last deal
You will find yourself at a losing end if you enter a real estate negotiation thinking it is the last hope. This mentality often costs big time for real estate agents, buyers, and even sellers. There are hundreds and properties in the market and no matter how much you like one of them, there is always a better alternative. When the only thing on your mind is to win the discussion, the chances of losing empathy and humility in between are high. Once this happens, the other party starts feeling uncomfortable and things end with nothing good for anyone. Your aim should be striking a deal with a win-win outcome. Present your issues but also listen to others to come up with better reasoning and solutions.
Learn from your mistakes
If you lost a deal before, it is best to learn from your behavior and mistakes. Make a list of things that worked during the discussion and things that called for an end. Also, identify your weaknesses during the discussion as you would not want to repeat them ever again.
This information will give you a better hold over your negotiation skills the next time you find yourself negotiating for the right property.
Meet in person or talk over the phone
Real estate agent always chooses to connect with the buyer in person because that is the best way to bring a personal touch to the negotiation. If you cannot arrange to meet in person, a phone call is the next best way to connect. When you sit across the table facing the other party, you are limiting their time to think and respond with a clause that works in their favor. However, the same applies to you and hence research is recommended once again. Do not let the other party catch you off guard.
Know what is happening in real estate
It is a fact that knowledge makes you a better negotiator. If you have decided not to hire a real estate agent, it is recommended to learn the dynamics of the real estate market. The more you deep dive into the market statistics, the better you will learn about the price fluctuations and decide the best offer price.
Besides, you must also learn about the key factors determining the price of a property, several factors can add value to the property making it expensive while others have an adverse effect. There is a lot to observe which is why most people prefer working with a professional real estate agent.
Get other concessions
If the seller is not ready to negotiate on the price as per your will, it is best to ask them for other concessions. Instead of being adamant and sticking to your offer price, be innovative with your approach and seek other favors. Ask for some help with the repair and maintenance of other related costs that the owner would be happy to consider.
Before you reach the negotiation table, developing sound negotiation skills makes you a stronger candidate to succeed. The tips above will help you with your negotiation process and close a deal.
Real estate negotiation checklist
You must always have a checklist with you to stay reminded of what secures you the right deal. Here are a few pointers to quickly refer to during the negotiation:
- Make a win-win situation for both parties.
- Talk less and listen more.
- Be flexible and mild your terms as and when required
- Have an in-person meeting to negotiate.
- Learn the market as well as about the property.
- Show respect to the other party
- Have the ability to say no and walk away from the deal
Why is it best to hire a real estate agent?
The property buying process becomes way easier when you work with a credible Real Estate Agent. They can get you the best price deal and even match you with the right property without any hassle. He is a professional who depends on successful real estate deals for a living and hence gives the best in facilitating your real estate negotiation.
Let us discuss a few reasons for hiring a real estate agent instead of negotiating on your own:
They work on ethics
A real estate agent who is a member of the National Association of Realtors (NAR) abides by a code of ethics. The code of ethics ensures that the real estate agent remains true to his/ her duties and practices fair play. He is obligated to put the client’s interest before their own when working on a deal and thus obtain and disclose all information about the property to the client. Failing to abide by the code is penalized which can cost the realtor a big time.
They have pricing expertise
Price makes the basis of negotiations and offering a fair price is important. A realtor has the knowledge and expertise to assess a property and set the right price. They know the value of the property, location as well as the inclusions that affect the overall price.
Finding the right home
The toughest part of a real estate deal is to find the right property in the first place. It demands hours of internet search paired with a physical visit to the locality. Sometimes, the best properties aren’t even listed online which means you have to look for conventional modes of listing as well.
All this hassle can be prevented by hiring a real estate agent that does the hard work for you.
Avoiding last-minute problems
Closing a deal is the most sensitive part of the process and there are several pitfalls that you must be aware of. A real estate agent can sense trouble before the signs are visible. They are experts in the field and hence have a great sense to identify trouble and mitigate it. Right from financing issues to paperwork troubles, a real estate agent can easily tackle all types of problems that happen just before the closing.
Final words
We all want to save those extra $2000 when closing a real estate deal. You can negotiate on price, closing dates, closing costs, home repairs, inclusions, and more if you know how to do it right. If you want to win, thinking like a seasoned real estate realtor is the key. Gather as much information as you can about the property, neighborhood, and real estate market. Be humane in your discussion but also hide your feelings. The tips mentioned in this article are tried and tested by expert realtors. You can always practice a meeting with the buyer at home before participating in one.
The more you try the better you get and it takes you closer to securing the best deal. Use your power to negotiate and buy your dream property at the best price. The ability to negotiate is a powerful tool and you have the right to access it at your will. Best of luck!
