Negotiating Real Estate Deals: A Beginner’s Guide

Negotiating Real EstateBuying or selling a home for the very first time can be both really exciting and really stressful.

Generally, beginners in the real estate game are most nervous about the ins and outs of negotiating real estate deals, hoping to get the most out of the bargain for their cause.

However real estate negotiation is like anything else, there’s always a fair bit of compromise.

The following tips can be applied to both buyers and sellers in an effort to help them up their skills negotiating real estate.

Tip 1: Know the market

Knowing the market is the best way to ensure that your expectations are in check when it comes to property values, both real and assessed.

At any given point in time, the real estate market is considered to be in one of three positions: favoring buyers, favoring sellers, or favoring neither (an even balance of supply and demand).

Consider your position in relation to this market and realize that the best time to get a deal is when it favors you.

Tip 2: Consider leverage

Each real estate transaction is unique. Each property is different and each buyer and seller has their own set of circumstances which dictate their pace and need.

If you are selling a house because you are moving for work and need the money then you will be willing to take a lower offer than a seller who has no timetable for leaving.

Conversely, a buyer who is one of five bidding on a property will not be able to negotiate the way that a sole buyer will.

Tip 3: The devil is in the details

One mistake that both buyers and sellers make in negotiating real estate is relying too heavily on similar properties in an area as a base line.

Again, every real estate deal is unique and two homes of similar features (square footage, bedrooms, bathrooms, etc.) may sell for the same dollar amount, but that doesn’t tell the whole story.

What concessions did the buyer or seller make? Did the seller agree to share closing costs or fix the hot water heater?

Any of these details will not show up in your research and give an incomplete picture of the situation.

Tip 4: Financing needs to be paramount

Again, regardless of which side of the table you sit on, the financing situation is essential in negotiating real estate.

Buyers with pre-approval are far more competitive than those without it. This means that both buyers and sellers need to use financing as a basis for making decisions.

Learning the ins and outs of negotiating real estate can be tough.

That’s why it’s important to make sure that you are informed as well as why it’s important to make sure to use the services of a real estate professional who knows what he or she is doing.

Properly managed, the art of negotiating real estate will leave both parties feeling good about the transaction that they made and the new lives they are about to start.