Deal-making is at the center of a Real Estate Professionals job every day when taking part in residential negotiations. With this, there have been noticeable similarities and common denominators present in the majority of residential properties that our Buyers have picked up at what can be viewed as a “steal”.
The three most critical pieces of information that need to be understood prior to entering into nonemotional residential negotiations are:
- Don’t even consider a negotiation without this piece of info: “How much did the seller pay for the property and when did they buy it?” Thinking rationally, it should not matter what the Seller bought a property for because in a perfect world market price would find itself. But since the world isn’t perfect, if you are a deal seeker and you combine a property that was purchased 10 years ago for $200k that is now worth $315k with a Seller that is motivated a deal COULD be on the table at $300k or north. The thought of cashing out or moving on, combined with a nice profit, will typically help facilitate the transaction. Versus the exact same property, except the Seller just purchased it last year for $298k and would be taking a loss at $300k. The second Seller may be more inclined to sit tight and wait for $315k to cover their loses.
- How many days has the property been on the market for? This element is pretty obvious – Days on market combined with motivating mitigating factors can often lead to a low ball offer being looked at more seriously than if the property had been on the market for two weeks.
- Has the Seller purchased another property yet? Or any other motivating factors for them to move? The thought of carrying two properties can lead consumers to act irrationally. If possible, look into this. Even if the Seller holds their hand close, have your Agent test their position with the old ‘offer and walk’ technique. This approach will likely lead to a call back in a few days and a possible deal!
Deals are in the details!