Negotiations in a Home Sale

Negotiations

Expect to negotiate
Offers and counter-offers keep your potential sale alive. Negotiations are less stressful when you decide in advance how low you’re willing to go early.
Ultimately, you decide what to accept, but talk to your agent early about your expectations and stay open to his or her advice on what price best in today’s market

Be prepared

In negotiations, you have to know what your bottom line is, because the offer may be less than your asking price.  You may have more than one offer to compare. The highest priced offer may not be the best offer if you are asked to make costly repairs or contribute to the buyer’s closing costs.

To avoid surprises, work out several potential scenarios with me, so that you will be prepared with a response when an offer comes in.  I will  be able to provide an estimate of your closing costs, as well as the buyer’s closing costs, so you can do the math together.

Why Negotiate?

The offer on your home is the sum of the offering price and all the terms.  The terms effect your final net amount. I will do a net sheet to estimate what every bid will net you.  With this knowledge we can negotiate terms and price to get the best deal for you.

When the Offer Comes In

When an offer comes in, I will contact the buyer’s agent to find out as much as possible about the buyer and the buyer’s needs.  You want the agents involved to have a rapport.  Your agent will need to get as much information that will enable you to respond positively to the offer and still keep your bottom line intact.

Buyers often want to test the seller, and make offers below asking price. However, if the offer is close enough to accept, don’t sign right away. Delay the acceptance for a few hours.  This strategy lets the buyer know that the offer wasn’t jumped on, and may cause the buyer to think twice about being too demanding during the inspection phase.

In the case where you get a full price offer, study the offer carefully to add up possible expenses such as whether the buyer wants you to pay his closing costs.  A full price offer could signal that the buyer intends to negotiate a lot of repairs or refurbishing costs during the  inspection period. If you’ve had your own inspection, you’ll know what to expect and how much you will negotiate off the price or in repairs.

If the offer is uncomfortably below asking price, try to find out the buyer’s mindset.  Could the buyer be trying to buy more house than he or she can afford?  Could a change of financing help get closer to your price?  Can you help with the buyer’s closing costs if he or she will raise the offer price?

An offer with very little down payment may signal that the buyer has financing issues. Find out if the buyer has been pre-approved, which means that the buyer has actually been approved for a loan through sharing his/her financials with the lender.

Keep negotiations pleasant

Be patient.  While stressful, expect negotiations to go back and forth until the contract is amended to both the buyer’s and your satisfaction.  Trying to “just get it over with” can cost you money.  Don’t make a final decision until you have all the information you need, such as the buyer’s pre-approval letter and most recent comparable sales and active competition.

As long as you keep the relationship pleasant, respond to the buyer’s questions with receipts, documentation, and information in a timely manner, it will be easier to negotiate the sale of your home.

Buyers want to feel that they got a good deal, and the best way to make them feel good about their purchase is to show them that you have taken good care of the home, and that you are turning over a fine asset to their care.