When you are searching the market to find the ideal home to buy, you may stumble across the perfect home for your needs. However, there may be one very large problem. The property may be overpriced, and you may be wondering how you can make a lower offer that will be acceptable to the buyer without offending him or her. This can be a tricky situation to navigate through, but these tips will help you to more easily reach a successful resolution.
Learn More About the Market
Before you make a hasty decision about a more accurate and realistic valuation for the property, it is important to learn more about the local real estate market. Focus on the exact neighborhood where the home is located rather than the entire city. Research comparable homes in the area that are of a similar size, style and quality. Focus on features of the subject property that may make it worth more or less than the price of other homes in the area. For example, a renovated kitchen in the subject property may make the home's value higher than comparable properties that do not have a renovated kitchen. Look at the per square foot price of similar homes, and use this figure to determine a realistic sales price for the subject property. It may be helpful to print out a few of these online listings so that you can attach them with your offer as needed. Remember that the appraiser will also look at this same information to determine the actual value of the home. The lender's loan amount will be based on the value of the home rather than the sales price.
Consult With Your Agent
Your real estate agent may have incredible insight about the home and market as well. For example, perhaps the home has many new upgrades and improvements that you have not noticed, such as a new roof and HVAC system. These replacements could be worth tens of thousands of dollars, and they can affect the price of the home substantially. Your real estate agent can review the comparable properties that you found, and he or she may also find other supporting data that can be helpful in this situation. Your agent should understand how you have arrived at the price you are offering so that he or she can explain it to the seller’s real estate agent.
Communicate Openly With the Seller’s Agent
A savvy buyer’s agent will communicate directly with the seller’s agent before submitting the offer. The subject of the property being overpriced for the market should be brought up tactfully, and the seller’s agent may provide further details about how they arrived at the asking price of the property. In some cases, the seller’s agent may have said that the seller wanted to throw out a higher sales price to see what offers came in. While the seller may entertain your offer, he or she may want to wait a while to see if higher offers come in. With this in mind, you may need to structure your offer accordingly.
As you can see, there are several steps that you can take to successfully reach a compromise on the sales price of a home. In some cases, the buyer may truly believe the higher price is the legitimate value of the home. However, in many cases, the buyer will be open to negotiating when aa reasonable offer is provided, and this is even more accurate when the offer is substantiated by your own evidence backing up the sales price you have arrived at.