The Art of the Deal
Do’s and Don’ts for Getting The Best Deal When Buying A Home

If you’re like most homebuyers, negotiating the deal is your least favorite part of the process.  Even the least experienced negotiators, however, can hold their own with a little bit of work.  Before you make an offer on that perfect home, consider the following dos and don’ts:

DO find out how long the home has been on the market.  If the home has been listed at its current asking price for some time, the owner might be asking more than the market warrants.  Adjust your offer accordingly.

DON’T let your emotions cloud your objectivity.  Even if the house is everything you ever dreamed of, you still must be able to afford the payments, or you won’t be able to keep it. 

DO assess the seller’s motivation to sell.  Are they in a hurry, with time as their biggest consideration?  A lower priced offer with the right timing may eat a higher-priced offer with more demands. Match your offer with the seller’s primary need/desire.

DON’T make your first offer your final offer.  Be flexible; make a initial bid that gives you some negotiating room, allowing you to be flexible and raise your offer without going over budget.

DO set a maximum price that you’ll pay.  If you don’t have a hard number in your head, it will be much easier for the seller to negotiate you up to a price that you really can’t afford

DON’T forget to include contingences, such as inspections, financing approval, etc.  Make sure you and the seller agree on every detail, and put it all in writing.

DO confirm that the price and all contingencies are covered when the seller responds.  An unscrupulous seller might change the details, or an honest seller might simply make a mistake.  Make sure everything you want is in the contract before you sign it.

Reprint from AAA World July/August 2005