We will help guide you through this nail-biting phase of negotiating a house price, but ultimately, you call the shots. Here's how to negotiate like a boss.
Fail #1: Thinking House Price is All That MattersThat house with a price point $15k below your budget? It may seem like a deal — until you add on the costs of maintenance and replacing the aging appliances.
Planning on repainting, remodeling, or landscaping, too? Suddenly the price looks a whole lot higher.
When developing your offer, calculate in the costs that will go above and beyond a mortgage payment.
Fail #2: Refusing to Back Down on Small RepairsBefore you draw a line in the negotiation sand over, say, a deck with some rotten boards, ask yourself if it's worth losing the house over a repair that would cost less than a thousand dollars.
Say the house price is $250,000, which makes that deck repair less than half of one percent of the cost of the house. There's a lot of emotional energy at this point in the process, so give yourself a break rather than dickering over it.
A house negotiation is not about winning for the sake of winning. It's about getting the house you want at a fair price on good terms.
Fail #3: Waiving Formalities Because You're So in Love With the HouseDon't be so blinded by house love that you do something silly like skip some of the formalities of home buying, such as the home inspection in an effort to close the deal.
That and others like a termite or septic inspection, are known as contingencies. They're there to protect you from ending up with a six-figure money pit.
Imagine how quickly the house-honeymoon would end if you found a termite colony or that the identical house across the street sold for much less?
There are other ways to sweeten your offer and get that house:
If this is your first house, speed is an ace up your sleeve because you can move faster than someone who can't buy a new house until they sell the old one (another type of contingency).
And remember, while there's a lot of emotion tied up in choosing a house, it's still a business deal.
Fail #4: Getting Hung Up On a Few GrandYou offered $198,000. The seller won't budge from $200,000.
Before you walk away, consider this: Two grand is a lot of money, but in the house-buying world it's not so much. At an interest rate of 4%, with 20% down on a 30-year mortgage, that additional $2,000 will add just $8 a month to your payment.
If you can swing it -- maybe you can cut a small thing out of your budget each month -- it could be worth it.
Fail #5: Folding Because the Inspection Turned Up IssuesA good home inspection is going to turn up something. Usually several somethings. That's good. It means the inspector is doing their job. It's a rare day when a home passes inspection with no problem at all.
Plus, many things that turn up on an inspection are easily handled. You can ask the seller to do the repairs or knock some off the price so you can pay for repairs.
And while some problems may seem scary at first, like a roof leak or plumbing problem, they're almost always fixable and negotiable.
Fail #6: Offering Less Because the Decor is HideousThe faux-Tiffany swag lamp and trippy orange-and-brown wallpaper make your eyes itch. So you're planning on offering less — way less.
Before you do that, know the market. If it's a seller's market, your offer may be seen as an insult especially if the home's in good shape. And just like that, you've lost your dream home.
When you're ready to make that offer, look past the little stuff that you can easily change, and focus your negotiations on what matters, like the location and the bones of the house.