How to Negotiate For Your Next Property Like a Pro and Get Your Offer Accepted
Most of us will only buy a property a handful of times, and negotiating offers can be tricky, mainly when it is not something we practise often. This article will show how to negotiate like a pro so the sellers will accept your offer and you are on your way to your new home.
You've decided to buy a new home. You've researched, planned and agonised about getting the ball rolling. You've done the viewings, made the shortlist and finally found the one for you. It's time to make that offer.
This can be a very nerve-racking time. Figuring out how to play this can be confusing because the stakes are high. Buying a property is something that most of us will only do a handful of times in our lives, and negotiating is often something that we only do when haggling for a souvenir on holiday. It makes sense then that negotiating to buy a property feels daunting when it should be handled carefully, considering it is likely the most expensive purchase you will ever make.
You want to buy this property, which means the aim is to make an offer the seller will accept. With this in mind, the obvious price to offer is the full asking price, the price the seller is looking for. However, it is widely accepted that offers can be made when buying a property, as the sellers most likely expect an offer.
So, you need to understand your starting point and, crucially, where you plan to end up. There is usually a disparity between the price that you want to pay for the property and the price that the sellers believe their home to be worth, but you mustn't insult the sellers with your initial offer, as this will taint the rest of your negotiation and potentially the sale process.
- Be ready to justify your offer - Therefore, rather than simply lowballing your starting offer, which means making an excessively low offer that could be seen as disrespectful, be prepared to justify your offer. This goes beyond just saying that this is the price you want to offer or that you think the property is worth. Justifying your offer means that you should provide evidence. You must be realistic. If you can't explain the figure you've put forward, why should the seller accept it? Perhaps you have seen similar properties that have sold for less money recently, or the market may have changed during the time that the property has been available. A reduced offer shouldn't come with criticism of the property. Why should the seller sell the property to you for less money because you don't like their interiors? Conversely, if you can put an offer forward with reasoned evidence as to why you offered that figure, you will likely have more success with the purchase.
- Be prepared to increase your offer - Your initial offer is just that, an initial offer. A negotiation involves give and take from both sides so don't dig your heels in and refuse to increase your price. A little increase from you will likely encourage the sellers to come down a little from their figure too, allowing the deal to be made somewhere in the middle.
- Be prepared to buy - Your negotiation will be more successful if you can actually proceed with the purchase, should the seller accept the price. This means having your mortgage funding in place, an offer of your own home or the cash in the bank before you go in for a hard negotiation. Otherwise, the sellers have the upper hand, and there is no incentive for them to accept a low offer from a buyer who can't actually proceed with buying the property.
If you can put yourself in the seller's shoes and think about how you might feel if you were presented with the offer you intend to make, you will likely be able to come up with the justification for your offer and make this offer sensitively. The biggest mistake to make when making offers for a property is to forget about the seller and concentrate instead on the property. If you can't make an offer that they are willing to accept, you will not be buying the house, so getting them onside and working together to negotiate the deal is the only way to buy the house you want.
If you are in the process of searching for a new home and are looking for advice on how to best handle the negotiation on a particular property, get in touch with our team today.