From practising the art of silence to making an offer with your pre-approvals in order, a buyers agent shares their tips for negotiating the best possible price on your next property purchase.
It’s a delicate dance when it comes to selling a property. The seller wants as high an offer as possible, while the buyer wants to pay as little as they can. The trick to paying the lowest price possible boils down to sharpening your negotiating skills and brushing up on your knowledge of the local property market. Here’s how Rich Harvey, buyers agent, CEO and Founder of Propertybuyer.com.au suggests you negotiate like a pro.
Be familiar with similar properties for sale in the immediate area
“Supply and demand is a key factor when it comes to negotiating on price, and stock levels of similar properties in the immediate area determines this. If there are plenty of comparable properties available, there is far more wriggle room buyers can simply move on to the next if the price is too high and sellers know this.” he says.
He recommends becoming a regular feature at local home opens to build an accurate picture of what stock is available. While you can do some research on your laptop, seeing properties in person means getting a proper look at the quality web ads are designed to show the best features and the scale can be hard to gage.
Educate yourself about the future of the property and the market
A little extra legwork could reveal upcoming developments that may raise or drop the value of the property you plan to purchase; for example, nearby building approvals for high rises. This is one of many ways engaging a buyers agent can help you secure the best price as well as having excellent knowledge of current and past stock, a good local buyers agent knows what’s coming onto the market before it even hits, Harvey says.
Buyers agents can also provide solid market predictions based on a range of factors, including what’s being built in the area, any new transport links, or general rumblings in the property market that may see prices move up or down. All of this combined can make for a powerful bargaining chip come price negotiation time.
Have recent comparable sales data to support your offer
Harvey recommends purchasing data sets this can be done from websites including www.domain.com.au or your buyer’s agent will have this information handy. “These give you actual sales prices achieved, not just what’s being asked for properties,” he says.
Familiarise yourself with the data and bring it along with you when you’re negotiating price. Not only will it give you more confidence, it allows you to put across a factual argument.
Be prepared and contactable
“Part of a strong offer is making the agent feel you are ready to move ahead and can provide clear and prompt responses in the negotiating process,” Harvey says.
This means talking to your bank and having your loan pre approvals in place – a process that can take several weeks – so plan ahead.
Come in with confidence, but not too strong
Don’t be afraid to come in with an offer under the final amount you are willing to pay. If the agent says it’s a bit low, or the seller ‘probably won’t accept it’, this is not a no, so hold firm or use it as a negotiating point. Harvey says its important to remember the sellers agent is there to get them the highest sale price possible, and they will be engaging their own tactics to make you feel you need to bump up your offer. So, unless they expressly say your offer is not accepted, the offer is still in play.
At the end of the day, being able to stay strong when negotiating depends on your understanding of what the property is worth. Remember to leave your feelings and passion for the property out of it or you’ll end up losing perspective and pay more. And, if that’s your modus operandi, allow a buyers agent to do the negotiating for you and save yourself the emotion based price tag!
Words by Melanie Hearse