Houses For Sale - Negotiating The Price
- Author Debbie Morgan
- Published March 22, 2010
- Word count 818
Whenever there are houses for sale, there are house prices to negotiate and to haggle over. Here we look at how to negotiate from a buyers view and from a sellers view.
In any deal, be it houses for sale, cars for sale or any market item, both parties need to be happy enough with the final deal. The seller wants the highest price he can get and the buyer wants the lowest price possible.
In England and Wales the guide price is usually set at about 5-10% higher than what it is expected to get. It'll vary though a lot - it depends on the desirability of the property and the market conditions. If you want to sell quickly, you set the price at the price that you are happy to agree to. No offers. That's the simplest way to sell. You simply say this is the price you have to pay, take it or leave it. However, the risk is that your house may be left as there's room to negotiate.
When you first think about selling your house you will have valuations from several estate agents. They'll recommend a price for you to market your house at and will suggest a price bracket of what they expect you to achieve.
Of course you'll want the highest price but be prepared. Know yourself what price you are happy to accept - be realistic. Find out what similar houses in your area were sold for from estate agents and from online sites.
If you are the seller then generally when you receive an offer, you will try to push up the price by a few thousand. Be sure to liaise with your estate agent and tell them that you don't want to lose this buyer by being too pushy. You need to keep every door open just in case you do not receive any other offers.
Get to the point where the buyer offers his final offer. At this point, do not say no outright. Take your time, think it over. Ask yourself: How many offers have we had? Is this buyer likely to be reliable? Do we want to risk still being on the market if we say no? Is the offer enough to get what we want?
If you are the buyer, you need to know what you can realistically afford. You need to have called a mortgage broker to know what mortgage you could get and how much the monthly payments will be. You need to know what your deposit will be. You need to know the maximum price that you are able and willing to pay.
Once you know how much you can afford you will roughly know the price range of what you are looking to buy. Then, when you have seen a house you like, you will need to factor in extras: would you want to do work on the house? If so, how much will it cost?
Consider who the seller is. If it's a probate sale you may be able to get it cheaper than you normally would as the family of the deceased generally just want to be rid of the property. Properties of this nature often require some updating too.
When you make an offer remember you can always go up so start low. As you make a higher bid tell the agent why your offer is low e.g. the house needs renovating, it's slightly above your price range and you are stretching the affordability as much as you can, it's in a less desirable area than you would have liked, etc. Reasons are important when giving your price.
If you reach your maximum amount that you can afford to pay then don't be tempted to go over it. If you do, you could then be setting yourself up to be very stressed about money issues. Instead, find another house within your price bracket. Try not to set your heart on a house until you have exchanged contracts just in case it falls through for any reason.
Once you have an offer accepted you will probably have a survey done. Depending on the results of the survey, you may be able to negotiate again on the price. If the survey brings up factors that will be costly to you then you may be able to get some of the costs off the asking price.
When you are negotiating both buyer and seller need to take time to consider the amount of money to accept. Neither should be tempted to give an answer on the spot. Take time to think about it, then call back the estate agent later or the next day.
Meanwhile, and until the deal is done, the buyer should keep looking out for other houses for sale - just in case yours falls through. If you’re the seller, keep your fingers crossed!
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