Yahoo Finance Five tips on how to make an offer when buying a home
Putting in an offer on a property you love can be a daunting experience, especially if you’re a first-time buyer. But the nerves never really leave you even if it’s your second or third time around—or perhaps even more if you’re a serial mover.
It’s a stressful and uncertain process. It feels like you need to be part-Machiavellian master of strategy, part-illusionist, part-Trumpian braggart to successfully negotiate a property deal that leaves you a financial winner at the end of it all.
However, with enough preparation and thought, you can pull off a savvy negotiation that hands you the keys to a dream home at a price you’re totally happy with. So to help you avoid a rip off, here are five wise tips for making an offer when buying a home.
Be discrete
Don’t give estate agents or sellers too much information about you. Don’t tell them any specifics, like your top budget, or let them know about your personal circumstances. If they know you’re desperate to move, it can be used against you. Likewise, if you love a property during a viewing, keep cool and give nothing away. Play hard to get. You don’t want to give the other side of the negotiating table any leverage over you because they will use it. Act in good faith and be polite, of course—but be smart, too.
Research the local market
Understand the current state of the local market so you know roughly what properties of a similar type are selling for on the same street or nearby. Not only will this give you surer footing as to whether the asking price is reasonable or not, but it’s also evidence you can use to justify your offer. Also take note of how long a property has been listed without selling, and use online tools to check whether it has appeared on the market after failing to sell the first time around.
Gather intel about the seller
Not all estate agents are sharp. Some, through inexperience, carelessness, or plain old honesty, will give you crucial intelligence about their seller’s position. Perhaps it’s a couple going through a divorce and needing to sell the property as soon as possible, giving you a big advantage in the negotiations.
Maybe they’re in financial difficulty, or are keen to move because of some looming deadline, like the start of a new job somewhere else. Whatever it is, these things do have a habit of emerging during conversations with the estate agent or seller—so try to get them talking if you can, lower their guard with some casual conversation, and tease out vital information over the course of two or three viewings.
Work out your top price
You should know the absolute maximum you are willing to pay for the property before you enter negotiations. Don’t forget to factor in the local market and work that needs doing to the house to argue your case for why it should come at a discount. If you’re disciplined, it will stop you getting carried away in the negotiations and going beyond a fair price for the property. Be prepared to walk away—but also leave a final offer on the table. It may well call their bluff and, after some consideration on their part, turn a no into a yes.
Consider a buying agent
Buying a home is already an expensive process with all the fees and taxes involved, so it may seem counterintuitive to suggest adding another cost to the list. However, paying for a professional buying agent to do all this work for you—researching the market, negotiating, and so on—should really be seen as an investment. Their experience and savviness could end up saving you thousands of pounds as well as a tonne of stress—well worth the outlay.
