Negotiation strategies for homebuyers have always been a vital element of the home purchasing process. But today – with prices still increasing (though at a slower pace) and with inventory still lagging behind demand –negotiation strategies are even more important for buyers to get the best deal possible. Having a good local real estate agent in your corner is the best thing you can do, but there are several things you can do yourself as the buyer. So let’s take a look at some negotiation strategies for homebuyers in New Jersey.
Have Pre-Approval Letter in Hand
An easy and important one of the negotiation strategies for homebuyers in New Jersey is to get pre-approved for a mortgage loan – than to bring your pre-approval letter with you to the negotiations. This way, you’ll be perceived as a serious buyer who can get financing, and, as a result, you’ll have more negotiating leverage.
But there’s a trick to it, according to industry pros . . .
“A pre-approval letter is an obvious first step to show how much you’re approved for with a loan, but it should include the exact amount you’re offering for the house. . . The point isn’t to overplay your hand by showing you’re approved to borrow more than you’re willing to pay for the house.” You don’t want the buyer to know that you can actually borrow more than your offer.
Leverage Seller’s Motivation
Another of the important negotiation strategies for homebuyers involves leveraging the seller’s motivation. If you can find out exactly why the seller wants/needs to sell, you can use that to your advantage.
According to one top agent, you should always try “to find answers to the following questions: How soon do they need to move? Where are they going and what will they do if it doesn’t sell? Are there family circumstance changes such as marriage, divorce, childbirth, graduation, illness, relocation?” You should also look into the seller’s employment situation and financial circumstances, as well as tax assessments and criminal records. And be sure to talk to neighbors to find out even more.
If you can determine that the seller needs to sell desperately or needs to sell soon, you’re on solid negotiating ground. According to industry insiders, it can work like this: “Know the value, then know the seller’s reason to sell and level of motivation and count on a discount.”
You will, of course, need to lean on your agent’s expertise to look into all this to determine the seller’s true motivation for selling. To find out more, just call 855-966-DEALS.
Use the Negatives
Using the negatives, the drawbacks, of the house is also one of the important negotiation strategies for homebuyers in New Jersey. When you point out major flaws, the seller will likely lower the price.
“If a house has flaws that go beyond the cosmetic and will cost a fair amount of money to repair, then it can be worthwhile to ask for a lower price so you can afford to make the fixes.” So be sure to mention those problems to the seller and point out how much it will cost to put them right. When you do that, your lower offer just may be accepted.
And try not to be a “problem buyer,” one who is too demanding and overly aggressive. Try instead to be likable because sellers, the pros say, “like to sell their homes to people they like.”
“In many cases, selling a home is not always about grabbing the bidder with the highest bid . . . Sellers quite often want to pass off their homes to people they like because what they are selling was once their home.” So do your best to put your best foot forward and come across as a hassle-free buyer, giving the impression that the whole process and transaction will be an enjoyable experience all around.
Go Easy on the Counteroffers
Don’t overboard with the counteroffers either. Going crazy with the counteroffers will not make you look like a savvy negotiator. Although counteroffers are a typical part of the process (especially if you start negotiations far apart in price}, they can in fact be overdone.
Here’s what the experts recommend: “Don’t waste time by countering a lot, and start with your best offer. When you do counter, consider same-day deadlines instead of 24-hour deadlines.” Again, you’ll want to lean on your agent’s expertise to craft the best counteroffer possible.
Use a Good Local Agent
Finally, probably the best and most effective of the negotiation strategies for homebuyers in New Jersey is to use a good local real estate agent. An experienced agent will be skilled at negotiating and can help successfully navigate this minefield. In addition, a local agent will know exactly what appeals to and will work most effectively with local sellers. Your local real estate agent in New Jersey can be more help with negotiations than you can imagine. Find out today how our experienced agents can assist you. Just give us a call at 855-966-DEALS or send us a message