Negotiation buying a house

**97guns** · 07-13-2016, 03:27 PM

dont worry about the buyer, how long has it been on the market, how bad do you want it? the longer on the market the better chance they take a deeper drop in price

**tripods68** · 07-13-2016, 03:33 PM

It's only been 34 days. But we do want this house....i'm thinking i might offer 8K below asking since we have to replace the carpets (even though it was put in brand new).

**Singuy** · 07-13-2016, 03:51 PM

Depends on how expensive is the house. Also as long as you are not 10% lower than the asking price, you will probably not offend anyone. Guess what the market value for the house is by taking a comp nearby and do a price/squareft calculation.

8k drop is a pretty reasonable offer.

**97guns** · 07-13-2016, 04:18 PM

you can also contact the listing agent and pick their brain. sometimes you can have a lowball offer pushed through if you submit the offer with the listing agent, he will not have to split the commission with another agent and will try to persuade the seller to take your 0ffer

**Singuy** · 07-13-2016, 04:21 PM

Originally posted by 97guns View Post

you can also contact the listing agent and pick their brain. sometimes you can have a lowball offer pushed through if you submit the offer with the listing agent, he will not have to split the commission with another agent and will try to persuade the seller to take your 0ffer

But if you have used your own agent to look at the house, then it's best not to do this or else you can get sued (at least that's just a rumor, I haven't see any listing agents suing anyone).

**creditcardfree** · 07-13-2016, 04:35 PM

I would offer at around 97% of list plus or minus, unless you know or your agent knows that it is overpriced. I'd offer more if I knew there were competing offers. If the carpets are in bad condition, then request a carpet allowance to have them replaced, this then lowers your total amount paid. We had a buyer ask for us to clean carpets, we offered cash because we didn't want to deal the actual cleaning company.

Remember everything is negotiable. They will likely counter back, so a good first offer is helpful.

**LivingAlmostLarge** · 07-13-2016, 08:10 PM

How is it ever an insult? If they have no other offers at least they got something. I'd say within 10% of list or whatever is reasonable if for it if it's severly overpriced.

**tripods68** · 07-13-2016, 09:14 PM

We just bid on multiple homes. Unfortunately its a seller's market where we are buying--just to be competitive we offered (8K) higher than asking on the first home. Our agent thinks its competitive but its 50/50. The 2nd home, we bid 5K lower.

**Fishindude77** · 07-14-2016, 03:01 AM

My experience is that realtors always try to convince a buyer to offer a price real close to the listed price in order to make their life easier and get a quick sale. Have heard the line from them several times ... "We don't want to offer too low and offend the seller". Total B.S. Offer whatever you want and it's best to start low, as you can always go up after that, but you can't go down. The seller is in control, he can accept, reject, or counter your offer.

Simple stuff, don't get emotional about it.

**bjl584** · 07-14-2016, 03:03 AM

Originally posted by tripods68 View Post

We just bid on multiple homes. Unfortunately its a seller's market where we are buying--just to be competitive we offered (8K) higher than asking on the first home. Our agent thinks its competitive but its 50/50. The 2nd home, we bid 5K lower.

It's a seller's market where I live too. That makes low-ball offers nearly impossible. You might be able to shave a few thousand off the asking price, or ask for other things like assistance with closing costs, or ask the seller to leave appliances or furniture. Good luck.

**creditcardfree** · 07-14-2016, 04:13 AM

Originally posted by tripods68 View Post

We just bid on multiple homes. Unfortunately its a seller's market where we are buying--just to be competitive we offered (8K) higher than asking on the first home. Our agent thinks its competitive but its 50/50. The 2nd home, we bid 5K lower.

Well if it's a sellers market, and it's been listed for 30+ days it is probably overpriced. The lower bid is a good idea. Just make the best offer you feel comfortable with financially. Then negotiate. The first offer is rarely the end offer.

**snafu** · 07-14-2016, 07:03 AM

Understand that this is true capitalism. Seller wants every possible dollar, you are free to offer whatever you like and ask for any accouterments. You can always increase offer but never decrease!

It's time your agent earned the commission [you pay as it's your money in play, deducted from seller to pay the two agents]. Since this is a seller's market, how many days is average? [in our hot market bids are accepted before listing goes MLS; 30 days signals problems not easily rectified]

Agent is your employee and can ask any number of questions. How many offers in 34 days? Why homeowners are selling? What deficiencies were identified in inspections? Any easements? Do sellers have an up to date official appraisal and property boundaries? Your agent needs to give you data to make a reasonable offer like how many homes have sold on that block, in that community and work out selling price per square foot. What features add to value? School ratings, crime stats, size of property? sf? Finishings [hardwood/granite/stainless appliances (not merely looks like stainless), landscaping, finished basement, lowest priced house on the street] for example.

Any offer should include a weasel line like 'on satisfactory inspection.' I never let on to my agent that I'm willing to increase my offer if necessary. After all commission is based on percentage of sell price.

**tripods68** · 07-14-2016, 07:55 AM

Woke up this morning told our agent to bid FULL asking price with 5K deposit toward closing---to show we are serious even if it is not required by the seller.

We don't want overbid and turn around the seller is asking for half of the closing cost. But this gives us leverage the counter more if the seller wants more.

The 2nd home we have a better shot asking 5K below.

We have more houses to see this weekend that might change this whole thing.

BTW the first home is only been in the market for 1 day--rental HUD property with complete house renovation. The owner is in Italy for two weeks vacation. So the decision won't be decided next week.

**sv2007** · 07-14-2016, 10:27 AM

Originally posted by tripods68 View Post

We are about to offer on a home we found that we really like. But how do you make an offer and not to offend the seller or be rejected outright completely. How do you negotiate a deal that works best for the buyer....

We need some expert tips, or advise?

Are you first timer buyers? Do you have a buyer's agent? If so, just listen to her, she'd know your local market a lot better than us. Besides that's what you are paying for: the agent's experience and expertise in the local market.

Otherwise, where is this house? Street address. Then we can at least zillow to find a bit more on your local situation.

If you don't have a buyer agent, then there may be a possibility of getting it for a little less by working with the seller agent. But you must know the market well and know how RE works (legally you are not supposed to get a better price, but in practice, you do). Here, many times you can even find out the competing offers (which is really not legal on the seller agent part). You bank on seller agent greed.

Also, how strongly attached to the house are you? You can get a better deal if you aren't all that attached to it. In RE sellers try to sell you that each house is unique (which is a way it is) but it only works if you are strongly attached to it.

Is the house in need of repairs; immediately the market for those are smaller and hence low price (even with repiar costs added, many people don't want to wait around weeks/months to move in, they are renting and can't pay rent and mortgage for example).

Can you close immediately? Some buyers must first sell their house in order to buy. Sellers don't like these contingencies and may pick a lower offer without it. This is also where you may get in on a good deal -- some sellers have a need for a quick sell (e.g. cahsing out inheritance, divorce, job changes/lose, lots of issues).

Lots of ways to save money on buying a house. Even after your offer is accepted, a good home inspector should save you more money then his inspection cost (e.g. $500 inspection generates $5k of perceived needed repairs, which usually you can get $2.5k-$5k off the price depending on the market, here you either have to know it or have a good buyer agent).

Also, MLS is now available to pretyt anyone online, here, you can check how long a house has been on the market, what it's price adjustment have been. Tax records shows you its past transaction costs. Ask seller/buyer agent for comps then check them your self against MLS and zillow and looking around (if possible).

Negotiation buying a house