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How Much to Offer |
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I want to make an offer on a house, we are in a market that has remained consistent and doesn't seem to be affected by the recession as much as other areas.
I want to offer less than market price, what is a good rule of thumb, what percentage below market price should I offer.
What can I expect as the counter offer?
What other negotiating tips do you have. |
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There's no rule of thumb, because every seller is different. Some list at a rock-bottom price because they hate bargaining. Others tack on a few thousand dollars just to see what happens. One may be eager to sell because he's already moved out; another might not really care whether she sells this year or next. So every bit you can find out about the sellers' motivation is useful.
Beyond that, you need all the data you can get about what's been paid recently for nearby similar properties. You probably already have a good idea of how this house stacks up with its competition. If you're using your own buyer's agent, you should be getting some good advice on price there.
Some people think your first offer should be low-ball, the seller counters with a reduction, you come up a bit and that goes on till you reach a compromise. But it doesn't usually work out that way. Too many counter-offers can kill the deal. Emotions get involved, someone says "It isn't the money, it's the principal of the thing" and there goes the whole ball game.
I'd advise making your first offer pretty close to what you'd finally pay if you had to, something high enough to tempt the seller to accept it just to get the thing settled. If the house is new on the market, reasonably priced and seems to be getting a lot of buyer interest, I'd say offer full price and promptly. |
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Edith
Originally published on April 28, 2008 |
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