Even in a heated property market, negotiating with the seller is always worth a shot. Don’t be hesitant to make a lower offer and then negotiate higher! As previously stated, allow for some wiggle room in your first offer.
Aside from directly negotiating the amount, there are a few more options for negotiating the entire price:
- As previously said, keeping your offer letter free of stipulations is more enticing to the seller. There is room for compromise. If the seller is aiming for a rapid sale, you could agree on a closing date that works for them.
- If the seller wants to know you’re serious about the house and it’s a competitive market, they can ask for additional earnest money in their counteroffer but agree to the price you’re proposing.
- Asking the seller to waive or pay for certain closing costs is a popular negotiation tactic.
- If you’re paying cash, a strong cash offer, even if it’s slightly higher, might be a powerful negotiation chip when compared to other offers that are more unstable or have more stipulations.
Don’t worry, a good real estate agent will be able to help you with these!
Being light on contingencies in your offer letter is more appealing to the seller.
Making Negotiations After an Offer Has Been Accepted
Keep in mind that once you’ve agreed on a purchase price, the negotiations aren’t over. Let’s imagine the home inspection uncovers a few small flaws that the seller should address before closing.
However, it’s possible that the seller doesn’t have time to make repairs since they’re moving out of state and have too much on their plate. You may now ask for anything in exchange for taking care of the repairs yourself, such as a seller credit or an appliance included in the transaction.
What if your mortgage lender’s appraisal comes back with a value that’s lower than the agreed-upon sale price? If the seller does not agree to match the appraised value, the agreement may fall through. It isn’t complete until the sale is completed!
What to Do in a Bid Situation
Unfortunately, if your dream home is also the dream home of other buyers, you may find yourself in a bidding war. When a seller receives many offers at the same time, this is known as a multiple offer situation.
Here’s what could happen:
- The seller could request that the purchasers who have made the highest offers return with their best possible offers by a certain date. The seller will examine them and make a selection.
- The highest-bidders will fight in a bidding war to discover who can make the most compelling offer on the house. This may be the most expensive offer, but it may also be the one with the fewest contingencies.
The good news is that you can do a few things to signal to the seller that you’re willing to outbid the competitors. Here are some ideas to get you started:
- Up to a specified sum, offer to outbid the best bidder by $1,000. This way, you have a lower risk of being outbid.
- Pay in cash for the residence. This lowers closing costs and speeds up the closing process, which is definitely in the seller’s best interest if they’re also seeking to acquire another home.
- Increase your down payment amount and/or earnest money %.
- Remind the seller of why you like their house so much. Bring up the fact that you sent a handwritten letter! People like to believe that their beloved home will be treasured and appreciated by the next owner.
- Mention it again if you’ve been preapproved for a mortgage. The seller will be aware that there is a lower likelihood of your finance falling through at the last minute.
Tip: Resist the impulse to make direct contact with the seller. They’re probably under a lot of pressure, and you don’t want to add to it. Allowing your agent to explain your case to their agent is a good idea.
Make Your Offer Count With a Real Estate Expert
When buying a home, it’s critical to have the greatest agent on your side. A professional agent will be able to scan the market, look at the house in detail, and work with you to present the greatest offer possible, from searching for the ideal home to putting in that offer.