Essential negotiating tips when buying property
As with all negotiation, the more knowledge you have about the person you are negotiating with, the stronger your negotiating position will be.
Negotiation tactics
Your first tactic should be to find out how urgently the seller needs to sell their property. Sellers who have to sell quickly due to financial reasons, separation, job relocation or because they have already found a place and are part of a chain, are less likely to negotiate as much and more likely to accept a lower offer. To find out this information, make casual enquiries with your estate agent or even the sellers neighbours.
How long has the property been on the market? Properties advertised for over a couple of months may be over-priced so consider a lower offer.
But. before you make the first offer check prices of recently sold properties in the area on websites such as Rightmove and the Land Registry. Is the sellers offer comparable? If not consider offering just below what you think is the market rate.
It may also be worth checking with the Land Registry when the seller moved into the property, as if they have been there for a number of years they are more likely to be making a considerable profit and less likely to negotiate over your offer.
How low should my first offer be?
It is always tempting to put in a really low offer to start the negotiating process. However, this can have the opposite effect and can actually put off the seller from negotiating at all as a low offer will not make you look like a serious buyer.
Although offers of 20% below the asking price have been accepted,
If you are a cash buyer, putting in a low offer can often be very appealing to the seller as a quick sale is likely.
After you have done your homework and think the property is priced correctly for the current market consider offering the asking price or just below.
Every offer should be accompanied with a request to take the property off the market so you are less likely to be gazumped.