Last Updated on July 16, 2021 by Maggie Sutton
In the real estate world, the list price of a home is somehow both extremely important and ultimately meaningless. Yes, buyers use price as a major factor in their home search, and sellers and agents spend lots of time figuring out what a home is worth to develop a good pricing strategy. But in the end, the list price is just a jumping off point as you enter negotiating house price with the buyer. The actual sale price will be determined during the negotiation process. While this can be a bit intimidating to some home sellers, it’s a crucial part of selling your home. Here are some tips for how to get the upper hand in negotiations and come away with the best price for your house.
1. Work with a Licensed Real Estate Agent
When selling a house, the negotiating skills of an experienced real estate agent is something you want in your corner. They want your home to sell for as much money as possible. It generally means they make more on the sale, so it’s in their best interest to get the highest price without losing the sale. Homes for Heroes real estate specialists know your local market, they have a feel of what buyers are willing to pay, what the area is worth, and they are experienced negotiators. They also help you with purchase agreement specifics and legalities when you receive an acceptable offer.
If you are looking to sell your house, register online and Homes for Heroes will connect you with a local real estate specialist to discuss your interests and possible next steps. On average, firefighters, EMS, law enforcement, active, reserve and veteran military members, healthcare workers, and teachers can save over $2,400 when they sell a home with Homes for Heroes specialists. If you sell and buy a home, your rewards can double!
2. Get a Professional Home Inspection
Home inspections are a common part of the home selling process, as home buyers want to know if there are any potential issues with the property. As the seller, you’ll likely have to prepare a seller’s disclosure statement. While this all might sound like a benefit to buyers, there’s value for you as well.
Getting a professional home inspection helps you negotiate because it arms you with all the information you need. Buyers shouldn’t know more about your house than you do, and it’s important you know what you’re selling so you can represent the home accurately. If the inspection uncovers any significant issues, you can get them fixed to hopefully increase the eventual sale price. Ultimately, knowledge is power, both for buyers and sellers.
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3. Focus on the Mutual Benefits
Negotiating a house price is ultimately about reaching a compromise with the buyer. Each side will probably have to concede in a few areas, but both parties want to feel like they got the better end of the deal. When communicating with buyers, try to focus on how the deal is beneficial for both sides. It’s probably true anyway, and it will help the buyer feel confident they’re not getting ripped off.
Buyers know your aim is to make money. So, if they feel like you’re trying to convince them that they’re getting a really good deal, they probably won’t believe you. By focusing on how the deal benefits both sides, you’re much more likely to have a successful negotiation.
4. Create Some Competition
This one is pretty simple: If you can drive interest in your home, you can likely drive up the price as well. If buyers know there are a lot of people who want to buy your house, it will give you significantly more leverage in negotiations. The ultimate goal is to create a bidding war between buyers, with each trying to top the other’s best offer.
But to get there, you’ll need to do a good job of preparing your home to sell. Check for patching holes and cracks in walls and ceilings. See if there is any maintenance required with plumbing. Replace broken windows and repair the roof if necessary. And finally, with a proper marketing strategy, you are ready to sell your house.
Your real estate agent should also help you come up with a marketing strategy that will hopefully stir up some competition for your home. If you work with a Homes for Heroes real estate specialist, they’ll also save you money in the process.
5. Don’t Show All Your Cards
You hold the keys to the house, which means you hold the leverage in the negotiation. Play things close to the vest and remember that silence can sometimes be your most powerful tool. There’s simply no need to disclose anything that might tip the negotiations in the buyer’s favor.
For example, if you have accepted a new job and need to be across the country in three weeks for your first day of work, keep it to yourself. If a buyer asks why you’re moving, you can simply say you want to be closer to work and leave it at that. If they find out you’re on a tight timeline and need to sell quickly, the power shifts to their side. By playing it cool, you maintain leverage and can increase the chance of getting top dollar for your home.
6. Be Confident and Avoid “Selling” Your Home
This is one of the things people get wrong most often when negotiating a house price. Many sellers are eager to show off their home and be active in the selling process. But this can easily backfire. If buyers get the impression that you’re really working to sell the house and convince them it’s worth buying, they’re more likely to think it’s actually not worth buying.
Instead of acting like a used car salesman, try to project confidence and show buyers you know what you’re doing. Negotiations are always easier when you come from a position of strength.
7. Pay Closing Costs or Offer a Home Warranty
Nobody said negotiating home prices was going to be easy. Sometimes after a hard-fought battle, you just need to close the sale so you can move on. One tactic that can help seal the deal is to offer to pay part of the buyer’s closing costs, or offer a home warranty.
A home warranty can give the buyer peace of mind in case something happens with part of the home and its appliances, making them more likely to agree to a deal. It will also be a lot cheaper to pay for a warranty than it would to fix or replace every issue the buyer raises during negotiations, helping you come out ahead. If you’re working with a Homes for Heroes real estate specialist, you’ll already save money on closing costs, so you can afford to take on a little bit of the buyer’s closing expenses.
8. Buyer’s Market vs. Seller’s Market
Selling your house is never just about your house. It’s about the state of the local market overall and what expectations are going forward. If you’re in a buyer’s market, with lots of homes for sale and too few buyers, you might want to be more generous in your negotiations. On the other hand, if you’re in a seller’s market with limited housing stock and a surplus of buyers, you may stick to your guns a bit more. When negotiating a house’s price, it’s important to understand the market and how your home fits within that larger context.
9. Playing Hardball
This is where negotiations can really get interesting and it’s where your real estate agent’s experience plays an important role. Your agent will size up the situation and read the buyer before deciding to take a hardball approach. Playing hardball means refusing to budge from your demands, whether on price or another part of the deal. Hardball tactics include outright rejecting offers, countering a buyer’s offer by coming back at list price, or putting an expiration on your counter offer, giving buyers limited time to either accept or lose out on the house. But be careful. Playing hardball can easily backfire and you could chase off great buyers if you’re too inflexible in your negotiations. Read the buyer and understand the market before going all out with a hardball strategy.
In negotiating a house price, it’s all about doing what you can to give yourself the edge. By being aware of these tips, you and your agent can hopefully get the upper hand and come away with the best possible price for your home.
Eager to get your home on the market and start negotiating with buyers? Register with Homes for Heroes today and you’ll be automatically connected with a real estate and/or mortgage specialist who will be your dedicated partner throughout the home selling process.