The Art of Negotiation
So, you’ve found the house you love, you’ve secured your preapproval, and you’re ready to submit a competitive offer and close the deal. Simple, right? Not quite…now begin the negotiations.
In some cases, you can win a bid outright, and the house is yours. If there’s strong demand for a home, it usually goes to the best offer, one with the most favorable terms and highest price. and there is no room for negotiating. In a competitive market, it pays to work with a realtor who can put together a solid and compelling offer.
That said, sometimes, even in a competitive bidding situation, and for a variety of reasons, there may be room for negotiations. This is when having an experienced realtor on your side is critical.
Here are some strategies I use to help my buyer clients navigate and negotiate deals successfully.
Commitment to Closing
A seller may not only be evaluating offers based solely on price. Some sellers are looking to close quickly, and with minimal hassle. Working with a realtor who has a solid track record of closing deals can be an invaluable asset. And all sellers and their agents, no matter their circumstances, will want to work with an agent who can get the deal done.
Look for Opportunities
I am always thorough in investigating the property and finding points for negotiation. If a home has been sitting on the market for a while, if the list price isn’t supported by recent comps, or if the listing agent isn’t familiar with the local market, there may be room for negotiations.
The Market Will Bear
Up to the minute market knowledge and a keen understanding of the difference between list price and market value are key in negotiations. Part of my job is helping buyers understand this difference so that their expectations are set, and we can enter negotiations with a clear idea of a price that will achieve their goals.
Additionally, sellers sometimes have an overinflated sense of the value of their home, and their agents haven’t been able to convince them otherwise. In order to educate a seller on current value, I sometimes send the agent recent sales with detailed information on how those sales compare to the home.
Show Some Love
For some sellers, the choice to sell their home can be emotional. In these cases, I encourage buyers to strengthen their offer by submitting a “love letter” to the seller, explaining what they love about the house. All things being equal—or close to equal—with offers, this might make a difference for a seller with emotional ties to the property. For example, I represented a buyer who was a nurse. The sellers were the home owner’s children and their mother was also a nurse; she had lived in the home for more than 50 years. They ended up accepting our lower offer because of the connection the sellers shared with my buyer.
Timing is Everything
Being timely with an offer is an important first step in the negotiation process. But every step afterwards also matters. If, during negotiations, our response time lags, it may seem as if the deal could fall apart. I always counsel my buyers to be ready to respond as soon as possible, and to be certain of their limits before we begin the process so we can keep talks moving forward.
The Price Is Only Part of It
While the list price takes into consideration the home’s location, condition, and size, people tend to think price is the only point of negotiation. However, there are other points to consider that create value, such as terms, the closing date, credits, repairs, or a seller rent back. I can help you think creatively about maximizing value in ways beyond price that can often be the tipping point in closing the deal.
Everybody Loves to Win
While it’s true that both buyers and sellers are looking for advantages to maximize their return, getting the deal done often requires some give and take for both parties. While my top priority is always my client, I try to find “win/win” solutions that work to the benefit of both the buyer and seller. The goal is to keep talks going, and every response we receive from the other party gives us insight into their thinking and where there may be a solution.
Relationships Matter
As an experienced and respected agent, I’ve forged and maintained solid relationships with other agents. With my reputation, integrity, clear communication, and collegial relationships, we are starting from a position of trust, which helps us engage in problem solving to the benefit of both parties.
Negotiating a real estate deal can sound intimidating. But with the right guidance, thorough research, clear communication, and my solid reputation, you can be assured that your interests will be well represented.
My commitment is always to finding solutions that deliver the best possible results for my clients. And, while it’s a bit unpredictable, and definitely more art than science, negotiating every step of the way for your success is my priority.
