Buying a home is an undertaking that requires optimal contemplation and careful consideration, especially due to the amounts of money involved. Like any other form of transaction, there is always room for negotiation when purchasing a house. Negotiating enables one to get the best deal out of the transaction and save a considerable amount of money. Here are five tips that will enable you to sharpen your negotiation skills.
1. Do a Comprehensive Research
One of the most effective ways of improving negotiation skills is by performing due diligence on the property. Having enough facts about the status of the house helps one to negotiate more confidently. Some of the essential facts about the house include facts about the owner, the condition of the house and reasons why the previous owner intends to sell the property. Other crucial details from the research should include an overview of the area and the market price of other house options in the market in the same area. Understanding these facts can enable you to face the seller or agent with more confidence.
2. Give an Initial Cash Offer
Although it is considered an old-school negotiation skill, making a cash offer remains one of the most effective ways of negotiating. Such an offer convinces the seller that the buyer is serious about buying the property. This, however, does not imply that one should always carry cash to a house sale. Liaising with your financial partner, e.g., a bank for, easy access to your funds when needed is effective and safe.
According to this blog post done by Lendi, an initial cash offer in many transactions determines who the buyer will be, eventually. This is because most sellers in a transaction settle for the buyer with a cash offer over those without due to the convincing nature of a cash deal.
3. Dealing with Real Estate Agents
Being open, friendly and honest with the seller’s agent is another way of improving your odds of getting a good deal when buying a house. Communicating clearly and putting all offers in writing not only looks professional but also communicates to the agent that the deal is important to the buyer. Cultivating a cordial relationship with the agent also puts you in a better position of getting a better deal than other prospective buyers on the agent’s list.
4. Go in Hard
In cases where the property is in a hot market, moving in fast to claim it can help the buyer negotiate a better deal. One way of doing this is by convincing the seller or agent of the intention to make an initial deposit as the transaction is being finalized. This helps in saving time and bars other potential buyers from making their offers. According to Catherine Bakos of Empower Wealth , making a significant initial offer enables the buyer to trounce other potential buyers and enables you to have a good avenue for negotiation.
5. Know your Budget
It is a prudent decision as a buyer to never name the price first. One should allow the seller or agent to go first and state their price. This allows you to know the seller’s starting price and understand the negotiation range. The person who names the price first begins at a losing end according to experts. The lesser the agent knows the price range you are willing to consider; the better it is for you.
Haggling over the price of a home is not everybody’s cup of coffee. However, possessing the right negotiation skills is crucial and will determine how good a deal you will get.