Coming up with a reasonable purchase offer on a home that won’t insult the seller seems fair, but it's only natural to not want to pay more than you have to for a house. You can’t worry about hurting the seller's feelings, especially when mortgages are hard to come by. Offer what you believe the home is worth. If your price is too low, the sellers always have the right to say no, or you can increase your offer.
Arriving at an Offer
Before you make an offer on a home, crunch the numbers. If you don’t feel right about offering less than the seller's asking price, determine the recent sale prices of similar homes in that same neighborhood. This will give you an idea of the home’s current worth. Ask a real estate agent to get the information for you. The physical condition of the home, its fair market value, the strength of the local housing market and your own incentives for buying are all factors to consider when trying to arrive at a fair offer.
Making an Offer
Don't let fear of insulting the seller with an offer that's too low stop you from putting in a bid on a home you want to buy. If the sellers really want to sell, chances are they may come back with a counteroffer. In fact, hint to the seller's agent that you are open to negotiating. Letting the seller know that you are willing to negotiate the price upward may make a low starting offer seem less insulting. Once the ball is back in your court, it’s up to you to decide how much more than your original offer you are willing to pay.
While not all real estate agents are willing to present a low offer, if you’re working with an agent who isn’t afraid to take a lowball offer to the sellers, your offer may at least get the sellers negotiating. Even if they respond with a counteroffer that's not much lower than the asking price, how much you are willing to haggle over the purchase price depends on how badly you want the house. If you think the house is worth it, you can up your offer. Whether you do it in small increments or go ahead and make your best offer is up to you. Eventually, you may settle on a price that makes everybody happy.
Wheeling and Dealing
When you make an offer on their home, you are telling the sellers that you are interested. Depending on how motivated they are to sell, they may be willing to come down on their price. First, you have to get them talking. Otherwise, they won’t know how high you are willing to go. A sales contract may bounce back and forth several times between negotiations, but as long as you and the sellers communicate there is hope you can settle on a price. Not owning a home already may give you some extra negotiating clout. A homeowner who is anxious to sell may see you as a good risk since you don’t have to make the sales contract contingent on selling your home.
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