Home Purchase Negotiation
Ten questions you should ask your Sales
Associate and why you should ask them*
Property Specific
1. HOW LONG HAS THE PROPERTY BEEN ON THE
MARKET?
Why: The length of time a property has been
on the market may indicate the seller's willingness to
negotiate.
2. HAVE THERE BEEN ANY PRICE REDUCTIONS
DURING THE LISTING PERIOD?
Why: The amount of any price reduction, as it
relates to the overall purchase price may indicate the seller's
desire to attract an offer.
3. HAVE THERE BEEN ANY OTHER OFFERS ON
THE PROPERTY?
Why: It will be helpful to know if
offers may have been turned down and for what reason.
4. WHAT IS THE MOTIVATION OF THE SELLER?
Why: Motivation is the key element in
any negotiation. As an example, if the seller has already
purchased a new property your ability to close quickly may be an
attractive element of the negotiations.
5. WHAT PERSONAL ITEMS ARE INCLUDED IN
THE SALE?
Why: Anything the seller is willing to
leave behind that you won't need to buy when you move in has
real value. Consider those items in your offer.
Neighborhood Specific
6. WHAT IS THE PRICE RANGE OF SOLD
PROPERTIES IN THE AREA?
Why? This information is
important since it will indicate the top and bottom of that
specific market.
7. WHAT IS THE AVERAGE TIME ON MARKET FOR
THIS AREA?
Why: Short market times may indicate a
seller's market. If this is the case, you may face competition
from other buyers.
8. WHAT IS THE LIST TO SALE PRICE RATIO
IN THIS AREA?
Why: This information will indicate
seller's past willingness to negotiate and by how much.
9. WHAT IS THE AVERAGE SALES PRICE PER
SQUARE FOOT?
Why: This approach to establish value
works best where there are similar homes.
10. WHAT OTHER KNOWN FACTORS ABOUT THE PROPERTY
COULD AFFECT VALUE?
Why: Review the Seller's Disclosure
Statement very carefully.
FINAL RECOMMENDATION
If you will be financing the property, get
pre-approved for a mortgage prior to making your offer. This
will show the seller your commitment and ability to perform.
Preapproval can be extremely important in a seller's market.
*Depending on the type of agency
relationship you have with your Sales Associate, he or she may not
be able to assist you with these specific questions.
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