Buying a home is stressful, and can be even more emotional when it means selling your home at the same time.
So it can be a big help to know you’re paying a fair price for a property. Most people only buy a handful of properties or high value items in their life, so are completely unprepared when it comes to negotiation.
Real estate agents have the upper hand, since they do it day in day out.
Here are 3 tips to make you feel like a confident negotiator:
1. Tell the agent what you want
A common trait of weak negotiators is that they fail to have conviction in their goals or objectives. If you don’t have an objective in mind (or don’t communicate it), then it’s near on impossible for you to succeed.
To improve your chances of success, choose a specific objective before entering negotiations. For example, write down “for this property listed at $300,000, I want to pay a maximum of $285,000.”
Then, when you start negotiating with an agent, you know what you’re aiming for. Now, it doesn’t mean you jump straight to offering $285,000, but you have somewhere to anchor your bidding strategy.
2. Ask questions
An uninformed negotiator is already a step behind. If you know less than your bidding competitors, or even less than the agent, you’re in a position of weakness.
It’s important to ask as many questions you can and to do independent research to try to uncover everything about a property. Don’t scrimp on property inspection or pest reports. It is your right to request information about the property and to arrange the appropriate inspections. If you have any concerns about the state of the property, structure or history of renovations, be prepared to walk away.
Issues with the property can be used as leverage to negotiate a lower price. However, it’s important to understand that it will cost you money to rectify any issues.
3. Stick to your budget
This relates to point 1. There’s no point setting a goal if you can’t stick to it. When you set a budget for a specific property, never bid over it. Your budget should be within your borrowing power and include costs like stamp duty and lender’s mortgage insurance, if applicable.
Our Mortgage Advisers at Smartline Rockingham can help with buying strategies and helping you work out your borrowing power. Speak to us today to get the ball rolling.