Friday, November 19, 2021 / by Laura Larson
If you’re like most homebuyers, you have two primary considerations in mind when you start looking for a home. First, you want to find a home that perfectly meets your needs and desires, and second, you want to purchase this home for the lowest possible price. When you analyze those successful homebuyers who have been able to purchase the home they want for thousands of dollars below a seller’s asking price, some common denominators emerge. Although your agents negotiating skills are important, there are three additional key factors that must come into play long before you ever submit an offer.
Make sure you know what you want . . .
As simple as this sounds, many home buyers don’t have a firm idea in their heads before they go out searching for a home. In fact, when you go shopping for a place to live, there are actually two homes competing for your attention: the one that meets your needs, and the one that fulfills your desires.
Obviously, your goal is to find one home that does both. But in the real world, this situation doesn’t always occur. When you’re looking at homes, you’ll find that you fall in love with one or another home for entirely different reasons. Is it better to buy the 4-bedroom home with room for your family to grow, or the one with the big eat-in kitchen that romances you with thoughts of big weekend family brunches?
How Sellers Set Their Asking Price
For you to understand how much to offer for a home you’re interested in, it’s important for you to know how sellers price their homes. Here are 4 common strategies you’ll start to recognize when you begin to view homes:
Every seller wants to realize the most amount of money they can for their home, and real estate agents know this. If more than one agent is competing for your listing, an easy way to win the battle is to over inflate the value of your home. This is done far too often, with many homes that are priced 10-20% over their true market value.
- Your home is likely to be labeled as a “troubled” house by other agents, leading to a lower than fair market price when an offer is finally made
- You have been greatly inconvenienced with having to constantly have your home in “showing” condition . . . for nothing. These homes often expire off the market, forcing you to go through the listing process all over again.
Priced Correctly at Market Value
Priced Below the Fair Market Value