Yes, it’s a buyer’s market, so there is plenty of opportunity out there - but how do you actually go about negotiating a discount when buying your next property?
Yes, it’s a buyer’s market, so there is plenty of opportunity out there – but how do you actually go about negotiating a discount when buying your next property?
If you’re in the market for a new home or property investment, you naturally want to pay the lowest possible price, and there’s no better time to negotiate a solid discount than in the current property cycle.
With the term “buyer’s market” appearing in almost every real estate article you read, it’s clear that vendors are open to negotiation. But, that doesn’t mean you’ll automatically score a steep discount as a buyer. You still need to ask for what you want – and you need to ask in the right way.
As a buyer in the current market, “you may find yourself in the enviable position of being spoiled for choice, as well as having the upper hand as far as negotiations are concerned,” says Peter Boehm, author of The Great Australian Dream.
It’s not just the price that you can negotiate on: other aspects of the sale such as the settlement period, deposit, repairs and inclusions are all part of the equation.
When you kick of your negotiations, it never hurts to put in a low offer to see what happens, Boehm suggests.
“When making a low offer, it's a good idea to provide a credible reason – perhaps the roof needs repairing, the property needs modernising, or there is something about the property that reduces its appeal,” he says.
Boehm adds that the most successful negotiations are those in which “all parties walk away feeling that they've made a good deal”.
So, in order to get a lower price accepted, you may need to offer the seller some kind of compensation in return.
“One of the best ways to become an attractive buyer is to offer a quick sale. For maximum advantage, make sure your finances are in place before the negotiations start so that you're ready to move as quickly as possible,” he says.
And no matter what your offer is, try not to let your emotions enter the picture – even if you have well and truly fallen for the property.
“Try to keep a clear mind and cool heart,” Boehm adds. “For each offer and counter-offer, remember how much you might be saving – or spending – in the long run.”
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