In most parts of the United States, the market for homes favors sellers over buyers, especially first-time buyers. The inventory of houses for sale remains tight and prices keep rising. If you do make an offer on a house you might find yourself competing with other bidders, a situation fraught with its own perils.
Let’s say, by some stroke of good luck, you’ve made an offer below the asking and the seller comes back to you with a counter-offer somewhere between his first price and your first offer. Now what?
The pros at Realtor.com talked to realtors in different parts of the country and came up with a list of five negotiating tactics that are virtually guaranteed to fail. The first of these losing tactics relates to your initial offer, so things can go sideways before you even have a realistic chance at the house.
Here are the five negotiating tactics to avoid.
Making a lowball offer
If the asking price is, say, $300,000, that’s probably the top of a range the buyer has in mind. Your agent can dig up a list of recent comparable sales that will indicate the home’s market value. That’s probably the low end of the seller’s range and making an offer below that level is a waste of everyone’s time.
Asking for a several add-ons
If you like the patio furniture and would like to keep it, don’t ask the seller to throw it in with the sale price. The listing will typically include items like appliances that are included in the sale price and may list other items available to purchase from the seller.
Using the inspection as a negotiating tool
A cracked foundation is something that directly affects the sales price and you need to sort out who pays for what before you buy. But if an inspector says the house needs new smoke alarms or rain gutters, these are not usually something the sellers are required to fix and asking them to do so is a bad idea.
Negotiating in incremental amounts
Don’t inch up toward the price you’re ultimately willing to pay. Each counter-offer just delays the transaction and the seller may decide that moving on to the next potential buyer is better than dealing with you.
Making a “one-way” offer
It’s a mistake to assume that just because you are making an all-cash offer or because the property has been on the market for a relatively long time that you can just make the seller a “take it or leave it” offer. Most will leave it, and then where are you?