No one wants to feel like they’ve been taken for a ride, so when you’ve found the right property, how do you get it for the right price? Here are some things to consider when it comes to purchasing negotiations.
Do your homework
Property prices are influenced both by demand and how much other potential buyers are willing to pay. Before you make an offer, research similar properties that have sold recently in the same area. Also consider organising a pre-purchase building report as any issues with the building may give you leverage to negotiate a lower price.
Length of settlement is another factor that can be negotiated. You may like a longer settlement to give you additional time to save, or if the seller wants a quick settlement then you may be able to accommodate that with a reduced price.
You may also be able to negotiate the clauses around your purchase offer such as the length of time for finance approval, and whether your offer is also subject to the sale of an existing property.
If you have a bank pre-approval this could also strengthen your negotiating power.
Keep your cool
Play your cards close to your chest and don’t reveal your position.
This includes keeping the maximum amount you’re willing and able to spend confidential. Otherwise, the agent may try to push you closer to your maximum, even if your current offer is a fair one.
If you’re serious about the property, it might be worth making an offer slightly above estimated market value, as long as it is still within your means. But don’t risk significantly overpaying just because you’ve become attached. New properties are being listed all the time, so something else will always come along – and it might even be better.
Most importantly, try to keep your emotions separate from your negotiations. Don’t let competitiveness or fear of losing the property push you past your limit.