Negotiating the Best Price on Your New Home

Wordpress CottageBuying a house is a big commitment. Because it is such a large investment it’s very easy to get stressed about the entire process, especially after you’ve just walked into the home you know you just can’t live without. G. M. Filsko knows the feeling. She is an attorney and award-winning writer who has to remind  herself to remain unemotional during negotiations just like the rest of us. Filsko has some suggestions for how to get through the negotiating process while making the best deal you can on your new home purchase.

Keep your emotions in check and your eyes on the goal, and you’ll pay less  when purchasing a home.

Buying a home can be emotional, but negotiating the price shouldn’t be. The  key to saving money when purchasing a home is sticking to a plan during the  turbulence of high-stakes negotiations. A real estate agent who represents you  can guide you and offer you advice, but you are the one who must make the final  decision during each round of offers and counter offers.

Here are six tips for negotiating the best price on a home.

1. Get prequalified for a mortgage

Getting prequalified for a mortgage proves to sellers that you’re serious  about buying and capable of affording their home. That will push you to the head  of the pack when sellers choose among offers; they’ll go with buyers who are a  sure financial bet, not those whose financing could flop.

2. Ask questions

Ask your agent for information to help you understand the sellers’ financial  position and motivation. Are they facing foreclosure or a short sale? Have they  already purchased a home or relocated, which may make them eager to accept a  lower price to avoid paying two mortgages? Has the home been on the market for a  long time, or was it just listed? Have there been other offers? If so, why did  they fall through? The more signs that sellers are eager to sell, the lower your  offer can reasonably go.

3. Work back from a final price to determine your initial offer

Know in advance the most you’re willing to pay, and with your agent work back  from that number to determine your initial offer, which can set the tone for the  entire negotiation. A too-low bid may offend sellers emotionally invested in the  sales price; a too-high bid may lead you to spend more than necessary to close  the sale.
Work with your agent to evaluate the sellers’ motivation and  comparable home sales to arrive at an initial offer that engages the sellers yet  keeps money in your wallet.

4. Avoid contingencies

Sellers favor offers that leave little to chance. Keep your bid free of  complicated contingencies, such as making the purchase conditional on the sale  of your current home. Do keep contingencies for mortgage approval, home  inspection, and environmental checks typical in your area, like radon.

5. Remain unemotional

Buying a home is a business transaction, and treating it that way helps you  save money. Consider any movement by the sellers, however slight, a sign of  interest, and keep negotiating.
Each time you make a concession, ask for  one in return. If the sellers ask you to boost your price, ask them to  contribute to closing costs or pay for a home warranty. If sellers won’t budge,  make it clear you’re willing to walk away; they may get nervous and accept your  offer.

6. Don’t let competition change your plan

Great homes and those competitively priced can draw multiple offers in any  market. Don’t let competition propel you to go beyond your predetermined price  or agree to concessions—such as waiving an inspection—that aren’t in your best  interest.

Published by G. M. Filsko, 06/04/2010

G.M. Filisko is a frequent contributor to  many national publications including Bankrate.com, REALTOR® Magazine, and the  American Bar Association Journal, she specializes in real estate, business,  personal finance, and legal topics.

-BW 06/04/2013

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About bertwilliamshomes

Bert Williams has been a Tulsa/Broken Arrow resident since 1989 and was in the broadcast television equipment brokerage business for 14 years and in advertising and marketing for over 30 years. Bert joined the rapidly growing Chinowth and Cohen Real Estate team in 2005 when there were only 45 associates. Now with over 350 associates and eight offices across the Tulsa/Broken Arrow/Owasso/Bixby/Sand Springs/Bartlesville/Grand Lake areas, Bert has the support and resources through the C&C team to find the perfect home for you and at the same time find the perfect family to purchase the home you own now. In 2013, Bert became a full time Real Estate agent working from the Broken Arrow office. His experience with negotiations and with the Real Estate market dating back to 2005 give you a great advantage when you decide to buy or sell a home. Call me at 918-809-5199. I look forward to meeting you!
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