In real estate, negotiation is a subtle art. One must assess all the information about the sellers as possible, including the REALTOR® they are working with and attempt to ascertain just how far they can be pushed. Some sellers just want to ‘play the game’, whereas others may seem like they are ‘playing the game’, but in reality when they say, “this is the final price” they mean it.
Things can be further complicated if the sale is not arm’s length (family or friends involved) or the sellers (or buyers for that matter) have a reputation (good or bad) in the community. All of this represents the importance of having solid, ethically based, representation via a REALTOR® (we can help, click here).
Still, skilled negotiators can almost always find some common ground that satisfies all involved parties. On the other side of the coin, using the wrong negotiation tactics can sink a deal like quicksand. These are some negotiation tactics that are usually best to avoid, but I’ll in no way undercut the intuition and research your REALTOR® may have done. Perhaps one of them below will work, but in general, they are high risk and usually end in failure…
- Low ball offers: A far-below-market-value offer damages your credibility as a buyer and can be insulting to the seller. In most cases, the seller likely has an acceptable range in mind. If you’re not even coming close to the low end of that range, they won’t even consider the offer and might write you off as a potential buyer.
- Incremental negotiations: Though it might be tempting, don’t continuously go back to the seller with small increases in your offer ($1,000 or less, for example). The constant back-and-forth grows tiresome fast and will often lead the seller to consider other opportunities.
- “Take it or leave it”: Try not to draw a line in the sand with your initial offer. It will often make the seller get defensive and consider other offers if you indicate right out of the gate that you’re unwilling to budge. Even if it’s the truth, don’t make a show of it.
- Nitpicking post-inspection: If inspection reveals a major issue, it should of course be factored into the final sale price. But doggedly insisting on a lower price for every minor fix can leave negotiations in a stalemate.
- Requesting more, more, more: Avoid giving the seller a reason to build up resentment and to think that you’re being greedy. Some buyers will leave a bad taste in a seller’s mouth by requesting add-ons like appliances or furniture that weren’t included in the listing.
These offers may sound sexy initially, but if you lose your dream home or add to the already stressful process of buying/selling a home, you may wish you went with a more tactful negotiation tactic. There is no reason why you can’t talk to a REALTOR® about their negotiation tactics before you hire them – in fact we have some preset questions that you can ask in our free video guide to hiring the perfect REALTOR®, for you! It has a $997 value, but can be yours free today, just click here.