One of the most interesting phenomena I’ve encountered with home buyers is that they believe they have little negotiating power almost across the board. Buyers generally assume that the property is owned by the lender and the bank has the capital so they must have all the control, right? NOTHING. get redirected here.
Buyers enjoy considerable power in home-price negotiations as well as in mortgage negotiations. But never believe that they do. Let’s have a look at negotiating your home price. Buyers assume that sellers consider their home to have multiple qualified prospects. Crafty real estate listing agents lead consumers to think they might risk it if they don’t step on this home in the next few hours. So because of all this “value,” there is no question that the seller would find anything less than the full asking price.
Throughout my knowledge there are very few hot markets where sellers have their list of several pre-approved buyers ready to close. I live in Baton Rouge, a city flooded with hundreds of thousands of people following Hurricane Katrina. Baton Rouge was that hot market at the moment. But barring a catastrophic event that sends hundreds of thousands of people to your town in search of housing, that’s almost no hot market.
If you’re a pre-approved buyer purchasing a property in the next few weeks, you’re gold to a property seller. The majority of “interested” buyers are what we call “tire kickers” in real estate. These are buyers who are inclined to buy in the next six months or ten years and decide to start looking. They don’t have their present home for sale, they haven’t spoken to a bank to see if they can afford the house, and they’re just trying to get an idea of what’s out. On the other side, you’ve got a bank to decide to lend you money for a house, you’ve selected the neighbourhoods you want to move in, and you’ve got a list of other houses you’re dreaming of. The seller would say, “We’d best not let this one get away, because then we’ve got to start having open houses every weekend.” This scenario offers you great negotiating power as a buyer.
Make sure the seller and seller’s representative realize that a bank has pre-approved you and that you’ll be purchasing in the next few weeks. Let them realize that you have some attractive options, and that you have to be able to get home at a price that you find reasonable. Spend some time walking the house thoroughly with the seller and agent, and ask many questions. In bargaining, there is a theory where buyers become more negotiable in proportion to the time they spend with a customer.
Look at the facts, now. The investor will sell their house so they can move on with their lives. A house aren’t easy to quickly turn to cash. You have cash (or the bank’s pledge of cash), and in the next couple of weeks you will be making a decision about several attractive options. Make sure the seller and seller’s representative are aware of these facts, and see the power shift opinion in your favor.