Negotiate like a pro – 9 tips to land the best deal on your new home

Negotiate like a pro – 9 tips to land the best deal on your new home

If you’re like most Australians, buying a property will be the largest financial decision you’ll ever make. Wanting to save money where you can is only to be expected, and negotiating on the purchase price is considered standard practice.

But what if your negotiation skills are lacking? Well, that’s where we come in. We’ve put together a list of the most important tips you need to keep in mind when trying to get the best price on your new property.

1. Know the market.
Understanding the current market conditions, particularly in the area you are looking to buy is a good place to start as a basis for your negotiations, and will give you an idea of what sort of competition you might be facing. Get an idea of how quickly properties are selling in the area, and the average price similar properties are going for.
If you’re not sure where to start, there are numerous online resources that can provide price and sales history guides by suburb and by state.

2. Do your research.
Finding out why the property is on the market, how long it has been listed for sale, or any other details of its history can inform the tactics you use. If the current owner is in a rush to sell, it may be easier to get them to accept an offer below market price.
The right knowledge can help you suit your offer to the seller as well; the promise of a short settlement timeframe might sway that owner looking for a quick sale to accept a lower offer.

3. Confidence is key.
Second-guessing yourself can leave room for the seller to take advantage of your uncertainty. Even if you’re uncomfortable with the process of negotiating, try to fake confidence. If you’re purchasing with a partner or spouse, ensure that you’re presenting a united front; discussions and disagreements will be necessary, but they shouldn’t be visible to the vendor.

4. Keep calm.
Leaving your emotions out of the equation can help you keep the upper hand; letting the agent or seller know how much you love the property can later be used by an intelligent negotiator to push the price up. Appearing to be interested, but not overly so, is much more likely to work in your favour.
Similarly, the agent might use tactics that will make you feel like you have to make a decision quickly or miss out. Keep a level head and remember that a hasty decision is more likely to act against you than secure a great deal.

5. Be realistic.
Coming into negotiations with a low-ball offer can set you up on bad footing right from the start. Too low and the seller won’t take you seriously, or may even be insulted by your offer. Either way, you’ll have a harder time later in the process than you would have had you gone with a more realistic figure.

6. Back yourself up.
Confidence will take you far, but even the most confident buyer can falter if they don’t have a justification for their offer. You’ve done your research, so you know that your offer is reasonable based on the location, property condition, and any other factors – be prepared to use this knowledge as a justification when presenting any offers or counteroffers to the vendor.

7. Don’t undermine yourself.
Undermining yourself or going back on your word is the quickest way to lose credibility when negotiating. Try to avoid phrases such as “this is my final offer” unless it is true, these sorts of statements lose any power the moment they are used more than once.

8. Know when to give and when to take.
You should be prepared to compromise to get the price you want. Whether that be in terms of your deposit, the settlement time frame, or any fixtures,  it is expected that there will be a give and take during negotiations. The key point to remember is don’t concede anything without getting something in return, and expect the other party to behave according to the same principle.

9. Reveal only what you need to.
Anything you say can be used against you. Well, not anything, but talking about your maximum price or love of the property can be leveraged against you. A seller who knows your borrowing power knows how far they can push you, which will absolutely be taken advantage of. The less they know about your situation, the more power you will have.