Five Tips to Get the Right House for the Right Price
By Peter Sarmas on 2 Oct 2013
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When buying property, every house hunter wants the best value for money they can get.
While this of course comes largely down to the value of the property, the market itself can be a competitive one – and buyers often find themselves going over their budget in order to beat the competition and secure their dream home.
However, there are other ways to go about it that can help enhance your chances of winning the property without hurting your hip pocket.
Read on for five tips to help you get the right house for the right price.
1. Work with the Agent
One of the most important tips to follow in order to get the price you want when buying property is to work with the agent selling the house.
While it is true that the agent works for the vendor – remember that at the end of the day, the faster they sell the property, the more productive they are able to be in their own working life.
“You can work with the agent by proving to them early on that you are a serious buyer.”
Some agents will try to get the best possible price for the vendor, but others will recognise the benefits of selling the house for a reasonable price quickly.
You can work with the agent by proving to them early on that you are a serious buyer and are willing to make a fast purchase. For example, if you insist on having your entire extended family traipse through the property at different times – that is adding for more work for the agent and can ultimately make them somewhat less receptive when it comes to negotiating price.
On the other hand, demonstrating that you have a strong knowledge of property values and an understanding of how to value a house, the agent will see you as a likely candidate for a sensible, easy and smooth transaction.
2. Negotiation Skills
When you come to deciding on a final sale price, you should give some serious consideration to the way in which you negotiate with the agent.
Like most situations in life, you are likely to have the best outcome by talking the price down in a humble, respectful and unassuming way.
Some people enter the situation overconfident, and overrating their own skills of persuasion. Keep in mind that this in the agent’s profession, they have been trained to be better than you at this – and they know how to value a property.
Nonetheless, they still want to sell you the property. If you are inflexible and name your final price straight off the bat, and it’s considerably lower than the agent feels they can get for the property, you are going to have a very hard time trying to negotiate the price any lower with the agent.
“Before you begin to haggle on price, do your homework and find out what the value of the house is.”
3. Sweeten the Deal
If you decide you want to offer a price significantly lower than what the vendor is asking for a property – consider having a second offer ready on hand to sweeten the deal should your first offer be rejected (and if it is significantly lower, it is likely it will be).
The agent will realistically know what the value of the property is, and may already expect that the home is unlikely to receive the full asking price.
By offering a lower price first, you make yourself known to the agent, and then when you come back with a higher price, it shows that you are a serious buyer but also puts you in a better position to negotiate – as you have already demonstrated your willingness to compromise on what you are happy to pay.
4. Don’t Over-Negotiate On Price
Before you begin to haggle on price, do your homework and find out what the value of the house is.
If the house is set at a fair price for what it is worth, resist the urge to try to argue it down lower, as you could find it does more harm than good.
If it is truly listed at a fair and reasonable price and you waste time on further negotiations, you could find that the property gets bought out from under you and you ultimately lose out on a good buy.
5. Ask Good Questions
As part of their training, some agents are taught not to divulge any information that could be likely to reduce the selling value of the house.
However, by asking certain questions, you can find out some important information that could help you obtain a lower price for the house.
One question you should definitely ask the agent is whether they set the price or the vendor did. In the event that the vendor set the price, it is possible that the agent does not think the asking price is an obtainable one, and knowing this will work in your favour.
“One question you should definitely ask the agent is whether they set the price or the vendor did.”
Ask them how much they expect the property to sell for. While this may not be completely honest, it will give you a rough idea of their opinion. If your research on the value of the property suggests the asking price is too higher, and the agent tells you they think it will sell for higher still, be wary of this agent.
It is a good idea to ask the agent what else they have in the market in that price range.
To an agent, this suggests that you are not solely committed to buying this particular property and are not emotional attached, which will raise your bargaining power significantly.
If you are thinking of buying selling or investing and would like a FREE 5 minute chat
with Street News Director Peter Sarmas, please contact him on 0418 740 606
or via email at [email protected]
