Top five tips for property price negotiation
In the market for a new property? Negotiating the purchase price can get ugly.
Start too high and you’ll be priced out. Open too low and you’ll be out of the game before it’s even started.
Here are our top tips for making that must-have property yours at a palatable price.
1. Prepare for success
Be sure of the property you want. Have all your due diligence done up front so the agent knows you are ready to act now and there are no other hoops to jump through. Set yourself a walk away price. Never go beyond that or let your emotions take charge.
2. Tell ‘em straight up
Make it clear to the selling agent that you have a strong interest in the property. Tell them clearly that you want to buy it – as long as a fair deal can be agreed – so they know you’re a serious buyer. Make sure the agent knows you’re looking at or other properties too – this will help you later in the negotiation process.
3. Ask what they want
Ask the agent “What will buy the property?” Don’t speak next: let them respond in full. You’re looking for any advantage or negotiation weakness here. Your goal is to unearth any signs the vendor is willing to move off a certain price or has external motivation for selling that could be to your advantage.
4. Make an offer
Start below what your end price may be, however, don’t make it so low that you kill off negotiations before you even start. A rough rule of thumb is 5-10% below where you may end up paying.
You want to get a response out of the seller. Hopefully they accept your first offer, but it’s unlikely. At the very least you want to receive their counter offer and ideally see some movement away from their initial expectations towards your offer amount.
5. Play it cool
Move with speed. Put a deadline on your next offer but make it realistic such as “COB the next business day.” Remind the agent you are considering other properties and viewing everything in the marketplace that suits your requirements.
Show no fear of loss should they turn away your interest.
This is normally when the real negotiation starts. If you increase your offer, do so very few times – don’t keep bidding against yourself in small increments. Don’t be afraid to stall at a certain figure close to what they may want in order to close the deal and make the seller stress a little in fear of losing the sale. Should you agree on a figure, keep the momentum going and wrap up the deal as soon as possible.
Still feeling like you’ll crack when it comes to price persuasion? Get us in and we’ll do the hard work for you. We’re Australia’s expert property negotiators and we can help you save thousands on the purchase price. If we don’t secure the property for lower than your target price, there’s no fee to pay.