Know your market. Let's face it, in order to get the very best deal possible, you need to know what the market value is. A savvy buyer and a professional agent are going to be market experts. They will be able to identify what market value is and then negotiate to get BETTER THAN MARKET VALUE.
Present your knowledge to the seller. Negotiating begins with the presentation of the offer. Simply putting an offer in on a property with no "set-up" is going to leave you with limited leverage in the negotiation and many times will be perceived as a "shark" simply by trying to take advantage of the seller. A powerful offer presenation will tell your story and humanize you to the seller, which allows them to be more flexible for you, not see you as their competition.
Let them know you love the home but in order to negotiate the best price you have to bring the seller back to reality. The seller knows you like the property because you put an offer in. It's imperative to remind them of the short comings that you are willing to overlook as long as the market makes sense. They will recongnize that you are buying a property that you like but it also has to make financial sense.
Obtain and maintain leverage during negotiations. In every negotiation, there are times when the leverage shifts. Learn the strategies that will allow it to shift in your favor, and you can negotiate with tough sellers and get the best price.
Concessions:
It starts with the presentation. When you set up the offer with a powerful presentation, you laid the grounwork for the seller making some concessions on things that may need to be updated, upgraded, repaired, and replaced.
Change VS. Cash Back: Once you are close to where you want to be financially, you can refer back to those items. Most sellers know there are things that not EVERY buyer is going to like in their home. Sellers that stop negotiating on price will often be willing to move more on repairs, etc. that they know could come up in another negotiation.
Closing Costs:
The surefire price reduction: Sellers are not surprised when a buyer asks for closing costs. Similar to concessions the closing costs offer a good avenue for the savvy buyer to negotiate a better price by minimizing the cash they have to bring to closing. Closing costs are a great negotiation tool, whther you need them to do the closing or not, as long as you know how to present the offer.
Know your guidelines and limits. It's important to know the rules. There are limits to what you can and cannot as for and your agent or mortgage lender can educate you on these important items.
Avoid asking for closing costs on cash deals. Some would argue that it makes the seller feel like they are getting a higher price. Just like you, the buyer, the seller is only concerned with HOW MUCH WILL I NET. Most sellers are completely confused and feel taken advantage of when closing costs are requested on cash deals. When they are confused, they shut down in negotiations.
A great negotiation can assist you in buying under the market value in many cases. A poor negotiator can cost you thousands!
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