In our current market, with the high liklihood of putting in an offer on a home with competing offers; negotiating needs to be top of mind. Negotiating starts before you even send your offer to the listing agent. Each piece of communication you make to your Realtor, and so your Realtor makes on your behalf, counts.
Negotiation is a subtle art in real estate, but skilled negotiators can usually find some common ground that satisfies all parties. On the other hand, using the wrong negotiation tactics can sink a deal pretty quickly. Here are some negotiation tactics buyers (and real estate professionals) should avoid:
- Lowball offers: Going far below market value when you make an offer damages your credibility as a buyer and can be insulting to the seller. The seller has a range in mind that they’ll accept, and if you’re not even approaching the low end of that range, they won’t even consider the offer.
- Incremental negotiations: Don’t continue to go back to the seller with small increases in your offer ($1,000 or less). The constant back-and-forth can grow tiresome and lead the seller to consider other opportunities.
- “Take it or leave it”: Try not to draw a line in the sand with your initial offer. The seller can get defensive and consider other offers if you immediately show that you’re unwilling to budge. Even if it’s true, don’t make a show of it.
- Nitpicking after inspection: Obviously if inspection reveals a major issue, it should be factored into the final sale price. But insisting on a lower price for every minor repair can put negotiations in a stalemate.
- Asking for more, more, more: Some buyers will request that the sellers throw in add-ons like furniture or appliances that weren’t included in the listing. Try to avoid giving the seller a reason to build up resentment and think that you’re being greedy.
These days the smoking deal comes when you have landed a house that you love, not when you have weasled a deal and have gotten a huge chunk of change taken off. There is just too much demand for that to happen. A grounded and thoughful approach is important, and considering what others in the running, and the sellers might also be thinking will have you standing out in the pack.