5 infallible tips to negotiate the value of the property
A property is without a doubt one of the biggest investments that most people make throughout their lives. Therefore, it’s normal to feel insecure when it comes to the negotiations to get a specific house. But don't be alarmed, we guarantee that after reading this article you will have some notions of how to react to some of the stages that lie ahead.
If you prefer hiring a real estate service, you’ll have your life made easier by professionals, who always know the best way to take in this type of negotiation. (clarify all your doubts with us, here)
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1 - Know all the offers
In the real estate area, it’s essential to do a market research. If you want to sell or buy a house, you must always be aware of other offers that are similar to your property.
When buying a house, you must well know which is the value that you intend to spend and never transcend that budget. The first step, as already described above, will serve to analyze existent offers within the amount that you stipulated. This is one of the most important stages through all the process. You can always count with real estate agent help, he will know which properties identify to what you want. Always make a list with the several properties that you are analyzing, comparing the size of the house, the construction year, location and facilities, such as parking or schools in the surrounding area. With this method, you will be aware of which houses are really worth visiting and perhaps move on to the negotiation stage.
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2 - Manage your budget
Define a value to your budget, and be loyal to that number. Probably, you will have the tendency to give in when you are faced with too much demand and lower supply. Especially if the first trades don’t work, you’ll always have a tendency to do so.
Define a comfortable budget to buy a house. If you ask for a mortgage loan to buy your house, this will be a monthly cost that will follow you for a few years.
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3 - Know how to do a proposal
After finding your dream house, know how to act when you make a proposal. You should anticipate all the steps and prevent yourself from counterproposals, different from the initial one. Take these aspects into account:
- The maximum value for the property purchase;
- Which is the maximum value for the advance payment;
- Contingency management;
- Flexibility with purchase deadlines;
There are common mistakes made, especially by first-time house buyers, such as substantially lowering the value in the proposal submitted to the seller. Thus, there is the risk of not being taken seriously and not getting an answer.
Be fair in your proposals, if the property isn’t undervalued do not greatly decrease the global value proposed or simply do not change the value. Stand out, propose a high advance payment within your budget. Try to understand if the seller still lives in the house and propose a flexible term for house deed, taking this into account. There are several ways to negotiate without, necessarily, giving a lower global value on the property.
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4 – Stay neutral
If you think it’s a much easier process when hiring a real estate agent, you’re thinking right! Experts in this area know well what they are doing, and make all the hard work of house value negotiation way easier. (know all the advantages of hiring a real estate agent)
It’s all about staying neutral when you visit a house and not showing too much enthusiasm. This way, you’re helping your real estate agent get the best value for the property or better conditions for you.
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5 – Know the terms for a proposal
If your proposal is enlightening, it will stand out from the others and make the seller’s choice easier. You must take into account that, any proposal that you do, will be mentioned in the promissory contract (know in what consists the promissory contract, here). All the items that must be included in the proposal are:
- Global value – the global value that is proposed for the property;
- Advanced payment value – the value that is comfortable to you, to guarantee the house purchase;
- Deadline for a promissory contract – Here you should clarify the time you need to sign the promissory contract;
- Deadline for house deed – After signing the promissory contract, you must indicate how many days you need to perform the house deed.
- Contingencies – Unforeseen things happen, but if you know how to identify them first, the better. You also should indicate if you are waiting for an answer in order to proceed with the process.
- Method of payment – Identify which is your method of payment, if you will pay in cash or apply for a mortgage loan.