Buying a House? Want a discount with that?
Fri Feb. 28th 2020
Buy better: How knowing what you're doing can help you negotiate.
Negotiating can make a big difference when it comes to buying a house. Sure, you're never going to get a bargain in the Auckland market, but good negotiation skills can help you avoid paying too much - and help you get the house you want.
Here are our top five negotiation tips for buyers:
No conditions, no problems
This is one way that first home buyers have an edge. If you have finance approved, and don't have to sell your previous home, you can make an unconditional offer (check out the LIM and get a building report first, of course). This appeals to sellers as there is no possibility of the offer falling through.
Agents are not your friends
Agents are often friendly and charming - because that's their job. Remember that they're working for the seller, not you. They're not likely to outright lie, but they may exaggerate or push you to make an offer before you're ready. (It's amazing how often another buyer pops up just as you're about to make an offer). Get advice from an impartial expert if you're confused.
Flex is best
If you can, being flexible on settlement dates can boost your offer. If a seller is looking for time to buy a new home or needs to be out quickly, the perfect settlement date could make your offer more appealing.
The more you know
An agent won't tell you what price the buyer will accept (they shouldn't anyway). But you can find out more by asking other questions: Have there been any other offers? How long has the house been on the market? Are you aware of any problems with the house? Agents aren't allowed to withhold information if you ask. And being aware of any issues puts you in a stronger position when it comes to negotiating.
Some people think starting low puts them in a strong position, but it can put sellers off. If it's too low, they may assume that you can't afford what they're asking - making them unlikely to enter into negotiations. Or they could simply be insulted and unwilling to sell to you. That doesn't mean your offer needs to be too high, just realistic. Research the market and figure out what the house is really likely to go for before you make any kind of offer.
Leave it to the pros
The best way to be a better negotiator? Get professional advice from a mortgage broker. They know the market, know how the selling process works, and can help give you an impartial view if you're confused about anything.
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