5 Key Real Estate Negotiation Tips!
Don’t split the difference
How to negotiate like a seasoned buyer’s broker!
We recently went into contract on a home with buyers in what was a really huge win for them. Without going into too many details on the property, per StreetEasy, the average price per square foot of the recorded 73 sales in the building is $1,620 while we are in contract for $1,270 a foot.
That’s right, we are in contract for $350 per foot cheaper than the building average. Given this recent success for our buyers I wanted to share some insight into how we made it happen.
While we’d love to be given an opportunity to have you or your friends or family as buyers, in case you feel the need to go it alone, here are some helpful tips for real estate negotiations:
1. Pick your spots
One thing too many customers do is over generalize the market. Statements like “the market is down” or “it’s a buyers’ market" -- those things can very much be true but that doesn’t mean a seller has to give away their apartment. Find someone who is motivated to transact. It may take time and some swing and misses but if you hunt long enough and smart enough you’ll find the right partner.
2. Be patient
Perhaps because we live in an age of instant gratification or because certain shows convey a negotiation taking 20 minutes, buyers expect a seller to consent to their bid immediately. It takes time for a seller to come to terms with the reality of the market and to accept your price. Be patient, time is your greatest asset in a difficult negotiation.
3. Have options
The hardest negotiation is when a buyer says we want the apartment for X (low) price but don’t want to lose it. You can’t hard-nose a negotiation AND have to have it. You have to have other apartments you’d be happy to purchase or at least a level of comfort knowing this negotiation might not work out. Playing it close to the vest comes with risk and you have to be comfortable with said risk.
4. Give a little
Since price is usually the most important term a buyer wants, be prepared to negotiate sweeteners as a way to concede something in the negotiation. Even if you’re flexible on say closing date, have a date in mind that might not be what the owner wants and then when the owner pushes back on it, concede. That way, it feels like a more balanced negotiation even if that wasn’t a big sticking point for you.
5. Be nice
Yes, everyone wants to be “tough” in a negotiation but the best way to get to yes is to keep things friendly and cordial. One value that a lot of buyers don’t fully comprehend is that a good agent wants to work with another good agent because there is rapport. That can go a long way towards getting you the price you want as that agent will push for you.
While we hope you find these 5 points useful, they are only the tip of the iceberg. Having sold over 250 homes over the course of 10 years+, our knowledge has become refined and our skills evolved. Don’t hesitate to reach out if you think there may be a home out there that you’re looking to buy!