Negotiating Strategies for Buying a Home (Part 1) was published last month. It covered tips for buying, strategies and negotiating.
Real Life Example
THE MARKET: A seller’s market
WHO: Hannah, a first-time homebuyer who had been going to open houses for months.
THE HOUSE: One day she drove down a side street and spotted a for sale sign on a house that wasn’t advertised in that Sunday’s paper. She knew the instant she walked in the door that she wanted the house.
THE AGENT: Hannah was not working with an agent. She sat down with the seller’s agent and drew up a full price offer with standard contingencies.
THE OUTCOME: Could she have paid less? Maybe. Did she feel burned? No. Her homework told her this was an unusually good property priced to sell.
Negotiating in a Balanced Market
A balanced market feels less like a pressure cooker because there is a more equal supply of homes and buyers. Since neither side is feeling market urgency, personal priorities reign. Expect the back-and-forth counteroffer phase to take longer than it does in either a buyer’s or seller’s market. After several rounds of paperwork, buyer and seller might agree to do a 50-50 split of their differences on price, terms, and personal property.
Balanced Market Strategy: Split Your Differences
Offer less than the asking price.
Include the standard financing and inspection contingencies.
Offer terms beneficial to you.
Ask for whatever personal property you want.
Buyer’s Tip: Both buyer and seller are likely to feel good about the transaction. They will each gain and give up something in the spirit of compromise during the negotiation.
Real Life Example
THE MARKET: A balanced market
WHO: Sarah had been looking for a house for some time when she spotted a FSBO in a desirable neighborhood and knocked on the door.
THE HOUSE: The home belonged to an elderly woman who was selling it with the help of her sons.
THE SITUATION: The homeowner fixed a pot of tea and the two women sat down for a friendly conversation. Two hours later, they had a verbal agreement, which was written up and led to a sale that left both of them pleased.
THE OUTCOME: A year later, the same neighborhood was in a tumultuous bidding war market. If the elderly woman had waited and worked with an agent, she would have gotten thousands of dollars more for her home. But this sale was more about getting a fair price for a sacred space and selling it to someone who would appreciate it.
Buyer’s Tip: Buying and selling a home is not always about money.
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