Negotiation is an
important tool of the real estate business. To be a successful home seller
you should have a basic understanding of negotiation methods, knowing the
motivation of the other party and adapting to their style. You can strengthen
your position as a home seller, by following these four negotiation tips.|
1. Get your home into top condition. If your home is on the market with obvious defects such as paint, repairs, cleanup, carpets and landscaping, you can be certain prospective buyers will either not look at it, or if they do and they make an offer, it will be low.
Examine your home carefully. If you spot anything that a buyer can criticize, your negotiating position will be weakened. For example, if your home has peeling paint, you can be sure buyers will lower their offer by much more than a paint job would actually cost you. To negotiate from a strong position, always get your house painted inside and out before putting it on the market.
2. Know the market value of your home. After getting your home in the best possible condition, improve your negotiating position by determining the true market value of your home. One way is to hire a professional appraiser to evaluate your home and provide an expert opinion of the market value. The cost will be several hundred dollars for a complete appraisal, depending on the size of your home and the difficulty of appraising it. Choose an appraiser who is properly licensed and is experienced in your area.
Another way to determine the market value of your home is to interview several real estate agents about listing it for sale. As part of their listing presentation, each agent will prepare a written “comparative market analysis.” This report will show the recent sales prices of similar nearby homes as well as the list prices of other homes currently on the market. By comparing the reports submitted by the agents, and by checking out the comparables they use, you’ll be able to determine the market value of your home. Be sure to throw out any inflated price opinion given to you by an agent who is trying to “buy” the listing.
3. Relax and be patient. Another way of stating this rule is, “The one who cares the least, wins.” For example, if you must sell your home quickly because of a job transfer or to avoid a pending foreclosure, buyers will take advantage of your vulnerable situation. Give yourself plenty of time by putting your home on the market early. Sellers who get the top prices for their residences are those who have their homes in excellent condition and who do not have to sell it by a deadline.
They can afford the “I don’t care” attitude, so they only have to sell if they get the price and terms they really want. A good real estate agent will support you when you take this position even if it takes a little longer to sell your home. Remember though, that in a slow real estate market, it’s always best to sell your home quickly before prices fall even farther.
4. Make the home buyers feel that they got a good deal. Your home is in great condition and you have it listed for sale at the right price. Now you get an offer. To make the buyers feel good about buying your home, negotiate on some minor points, such as the move-in date, the amount of the deposit or the personal property to be included in the sales price. The buyers will feel terrible if you accept their purchase offer without any negotiation.
If the buyer feels good about the transaction, the chances of a successful on-time closing are much greater than if the buyer feels he is overpaying for the home. Remember, from the buyer’s viewpoint, there is no worse feeling than having the first offer accepted without any changes. Then, the buyer knows the property probably could have been purchased for less.
Remember these special strategies when you are a home seller. When you understand these negotiating tips, you’ll enjoy an advantage in dealing with buyers.