bargaining

Looking For A Deal? There are literally hundreds of points that you can negotiate in a real estate transaction. Usually, you'll deal with just a handful when making your offer, such as the standard financing and home inspection contingencies. Most purchase contracts, especially if they are standard documents, contain boilerplate language that may not fit your situation and may in fact be unfavorable to you. These are areas you need to negotiate carefully. The more you know about the language and art of negotiation, the better the deal you can make for yourself, and the more money you'll save in the process.

Bargaining Strategies

Technique	When most effective	Possible outcomes
Start low and move up	Works best for properties that are overpriced in slow markets	Seller rejects outright or counters to get you to increase your offer, and you move up and agree on a price that comes close to what you want to pay
Offer close to asking price	Works best for properties that are priced well in active markets	Seller may accept outright or counter to get you to increase offer slightly.
Offer the top price you can afford	Works best in hot markets	Seller may reject and you may have to walk away
Save terms to bargain	Works best in situations where seller is highly motivated	Seller may trade price concessions for your agreement to close sooner or take charge of repairs after the inspection
Give up something to get something	Works in most situations	Seller ends up taking something you don't really want but you ask for initially to gain a lower price or other concession
Move in small increments	Works best for overpriced properties in slow markets	Seller may agree to lower price if given time to adjust to the idea
Focus on issues you can resolve to keep momentum going	Works best after several rounds of negotiation	Seller and buyer come to terms after resolving easiest issues first
Be unpredictable	Works best after several rounds of negotiation	Seller accepts your offer after you suddenly make sizeable change
Make an either/or offer	Works best after several rounds of negotiation	Seller accepts one of two scenarios you offer
Split the difference	Works best after several rounds of negotiation	Seller and buyer settle on price exactly between asking price and offer
Set deadlines for action	Works best in any situation	Seller and buyer will act more quickly and decisively if given a time limit

TIP: In a competitive bidding situation, a seller may try to influence your offer through your agent. If your offer is on the table and you hear from your agent that the seller will accept it if you change a couple of terms, ask for a formal counteroffer before responding. In some states, such as California, a seller can counteroffer with more than one buyer at a time. All states allow a seller to withdraw a counteroffer before it has been accepted by a buyer.