How to Negotiate a Home Offer
"I was working in Washington, D.C. at the time and hoping to transfer to Richmond, so I was only living in the house on weekends," the retired federal worker recounts. "It took me three years to fix up and when it was done, I was determined to make some money."
After putting the house on the market, Golden got a home offer quickly, but it didn't meet Golden's financial benchmarks.
"They originally wanted to give me somewhere around $106,000 for the house, but we negotiated it up to $115,000," Golden says. "I'm lucky I had an agent who was willing to help me get the price up to where I wanted it to be."
Golden got lucky in the negotiation process, but many sellers don't. For those who aren't well-versed in the fine art of negotiation, selling your house, especially settling on an appropriate home price with a buyer, can be scary. Here are a few tips from the experts.
1. Do your homework
"Sellers should go and actually see their competition," says Katie Wethman, a licensed Realtor with Keller Williams Realty in McLean, Va. "See what other people are getting for their houses and what their homes include. That will give you a realistic idea of your asking price."
Wethman adds that with so many homes both on the market and going into foreclosure, doing price research as you prepare to sell your house is crucial for those hoping to move their homes quickly. Price it too high and you may not attract any buyers. Price it too low and you'll be flooded with home offers but won't get the true value out of your home.
"People always think that they're going to name a price and then go back and forth 10 or 15 times with a buyer to find a compromise," adds Wethman. "It's usually only two or three times, so it's important to set a reasonable price from the start."
First-time sellers can start the research process by asking their agent to use a multiple listing service to determine prices of comparable homes in the area and by taking the time to tour neighborhood homes on the market.
2. Understand your market
Once you have an idea of what other homes in the area are selling for, it's time to research the larger real estate market.
Understanding whether you live in a buyers' or sellers' market comes down to knowing how fast homes in your area sell and whether the sellers were inundated with home offers or simply settled on the one they got. Before you sell your house, ask your agent for information on home sales in your area and talk to your former neighbors about their home sale experience if possible. Prospective sellers can also head to AOL Real Estate to investigate homes that have recently changed hands.
3. Negotiate, negotiate, negotiate
The key to successfully selling your house, adds Melle, is to look beyond the price itself.
"Everything is negotiable," she says. "If the buyers won't rise to the price that you're asking, you can negotiate other things like who pays the closing costs, upgrades or repairs that the place needs, and who pays for things like the appraisal or the home inspection. You can also offer to sell the house as is, without doing any repairs."
By thinking of the home sale as a transaction with several different pieces, many of which can be tweaked to help the buyer and seller come to an agreement that both can live with, the seller gains significantly more negotiating power. On top of compromising on repairs and upgrades, Melle says that the seller can also throw in or remove home warranties and negotiate their move-out date.
"It's all in thinking outside the box and working with your buyer's needs," she adds. "That makes the process so much easier."
More on AOL Real Estate:
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Find foreclosures in your area.
Get property tax help from our experts.
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