When buying a home, the offer you provide to the seller will largely depend on your finances, your attraction to the home and whether any issues were revealed during your tour or the home inspection.
While these factors govern your decision, the seller also influences how much you want to pay. In a market where buyers have the upper hand, you have more leverage. However, if inventory is tight, sellers have the advantage, and you need to sharpen your negotiation skills to get the figure down to a range you can afford.
Here are some tips for getting the seller to lower the asking price:
Research the market and the seller
Maintaining leverage in a negotiation with a seller requires that you do your homework. Check the sale price of comparable homes in the area and talk with your real estate agent to find out how long those homes were on the market before they sold.
Read real estate news as well. Many blogs and major publications can tell you who currently has more power in the housing market and give you insight into seller motivations. If you're interested in discovering more about a particular seller, you can even contact him or her directly. A seller who wants to move within a short time because of a job offer across the country is likely more willing to take a low-ball offer, so having an understanding the seller is important.
Work with a real estate agent
Professional help is always beneficial, especially if most of the sellers you encounter have their own agent. Real estate experts have negotiated in the past and possess a firmer grasp of current market conditions.
Additionally, an agent can be responsible for contacting the sellers or their agents. Constant calls to pitch a new offer are time consuming and not beneficial if you're busy. Let someone else do the haggling, and all you need to do is give a quick yes or no to the offer your agent receives.
Connect with sellers
While this is a sales transaction, you want sellers to consider you as more than an amount they can earn for their home. When possible, meet with them in person. Prior to the first meeting, you can even send a letter to introduce yourself, your family and your interests in the home.
Keep in mind that you don't want to lay all your cards on the table. Maintaining leverage requires that you get as much information about the seller and divulge less about yourself. This is particularly true in regard to your finances and how much you love the house. The seller should be working to keep your attention, so don't appear too interested or else he or she could gain more footing.
Know when to quit
It can be easy to get caught up in the negotiation so much so that you forget the purpose of your interaction with a seller. This is not simply a game to be won, so don't get lost in the competitive side of negotiating.
Also, don't waste your time or the seller's time. If the discussions aren't moving in your favor, consider other homes. Some sellers are stubborn and will hold out for their asking price no matter how you argue a lower offer.
Stick to the facts
Don't let your emotions or attachment to the house ruin your chances of negotiating a lower offer. Follow the trends noted by your research and your real estate agent's advice. If you let your emotions govern your decisions, you could get roped into paying more than you intend or get shut out by a seller.