If you ask the selling agent what price you should offer, you’re asking the wrong person.
Remember, the agent is paid by the seller to represent them and to get the best price possible.
However, it’s usually still worth asking them what they would consider was a ‘fair offer’ and then ask them to justify it with a list of comparable sales.
You are probably thinking that the agent just wants to make a sale, and in most cases you are right; in reality the agent doesn’t get paid unless a sale is made, so obviously he is keen to sell you the house.
But most agents prefer an easy negotiation, knowing that sellers get offended when they receive low offers on their homes.
This means they will probably recommend you make an offer close to the asking price.
By the time you end up at the negotiation table, you should have put some of these into practice, looked at many homes and gotten a pretty good idea of what similar homes in the area have sold for.
Remember, it’s the sale price, not the asking price that you need to focus on when you’re doing your pre-negotiation homework.
In most markets (other than during boom times), houses sell for considerably less than their asking price.
So to help you determine what price you should offer if you’re considering buying a property.
Here are 5 questions to ask the agent before you make your offer:
1. How did the vendor come to the asking price for their home?
Was it from the agent’s suggestion or because that’s how much they need to buy their next dream home?
Some sellers are unrealistic and unlikely to come down from their asking price if they have to get a certain amount for a particular reason.
2. Have there been any other offers made?
This lets you know if you have any competition and how serious the vendor is about selling their home for a reasonable price.
3. How long has the home been on the market?
If it’s just been put up for sale, the seller may not be anxious to accept the first offer.
If the home has been on the market for several months, it’s more likely the seller would be ready to accept your offer.
4. Why is the vendor selling?
Are they going through a divorce?
Do they have to move interstate urgently?
Have they already bought another home that would put them under pressure to sell their current home?
This will let you know how motivated the seller is.
5. Has the asking price been reduced during the time the property has been on the market?
This will tell you whether the seller is really keen to offload their home and also let you know that you might have a motivated seller on your hands and perhaps greater bargaining power.
For more property tips information visit the blog section of the Naked Real Estate website.