When it comes to buying a home, one skill will determine whether you get a great deal or end up paying too much. That skill is negotiation. A good negotiator will be able to use persuasion and logic to get the best possible price on a home. Even if you are not very skilled at speaking and debating, though, there are some tools and techniques you can use to gain a definitive advantage when negotiating the price on a property you wish to purchase.
The first tool you will need in your arsenal is the CMA (Comparable Market Analysis). CMAs can be obtained from your real estate agent and these reports tell you what similar properties in the area have sold for. When you are seriously considering a home, get CMA so that you can determine fair value on the property. Look at the most recent CMAs you can and focus on the homes that have recently sold – if they sold below asking value, that can be a strong negotiating point for you.
When considering CMAs, be sure to look at the property you are considering purchasing. Is it in better or worse shape than similar homes that have recently sold? Get an assessor and inspector to look at the property for you and adjust your offer price up or down depending on what you uncover. Be sure to consider any amenities your home has that affect its resell value – these may require a slightly better offer, if the recently sold homes in your CMA did not have the same amenities offered.
If you are working with a buyer’s agent or buying directly from the seller, try to determine why the seller is putting their home on the market. If they need to sell fast for financial reasons, you may have a little more room to negotiate. However, if the seller is just placing the property on the market to see how much he or she can get for it, you may have to work harder to negotiate.
Another thing you will want to consider when negotiating is your preparation level. Great negotiators do not get emotional. Before you start negotiating, determine how much you can afford to pay for the property and how much you want to pay. If a seller wants too much, walk away.