Home Guru: Getting the Home You Want at the Right Price

Home Guru: Getting the Home You Want at the Right Price

Getting ready to start looking for your first or next dream home in the New Year?

Negotiating the best possible price on a home is part art and part science, with a dash of luck for good measure. The task is tricky and can’t be reduced to a simple formula. It takes years of experience to know the best approach for a specific situation.

But there are steps that you can take as a first-time homebuyer to increase the odds in your favor for getting a good deal on your dream home.

Some experts advise taking the emotion out of the process and treating it strictly like a business deal; if you can’t get the price you want, simply walk away and look for another property. If you want excellent background and guidance on applying different theories of negotiation, the Harvard Negotiation Project offers many resources.

But as anyone who has ever shopped for a home knows, it’s nearly impossible to remove your feelings completely. After all, buying a house to serve as your primary residence can generate many emotions, including the thrill of excitement as you contemplate closing the deal.

Expressing the emotions can be good in some negotiations. Your real estate agent can provide some guidance. In some negotiations, expressing your love for a particular house can work in your favor, such as when a seller is considering competing offers and wants his or her former dream home to end up in worthy hands. Being a hard core negotiator in these types of situations can work against you.

Following are a few tips for getting the home you want at a fair price:

• Educate yourself. Know the market and try to determine the market price for the house you want. That way, if you decide to pay a little over market price because the home fits your needs so well, you do so with your eyes open and can feel confident in making the offer. Similarly, if you offer less than the home’s value, you’ll know if you’re getting a great deal.

• Know what you can afford. The income calculator on the Guild Mortgage website can help you be prepared. And a professional loan officer at any Guild Mortgage branch office can help, too.

• Be realistic. Don’t go too low-ball, or the seller might become insulted and refuse to work with you, says FoxBusiness.com. Try to find out the seller’s situation to determine the level of his or her motivation to sell. Your real estate agent may be able to provide additional insights into the neighborhood and market that might impact the sales price.

• Be flexible. If the seller is unwilling to budge on price, seek concessions such as closing costs, repairs paid for by the seller, or appliances thrown in the deal, says Credit.com. On the flip side, offer to close the deal quickly, or reduce the time you will need to complete your inspections, as an alternative to increasing the dollar amount of your offer. One aggressive approach in competitive situations: agreeing to take the house as-is.

• Dot your i’s and cross your t’s. Go over your offer carefully before you submit it, and correct any errors, says About.com. If the seller’s agent has to make a counter-offer to correct mistakes, the seller could decide to change the terms of the deal or even take another offer.

The best approach involves combines ideas from multiple viewpoints. Do your research. Don’t get overly emotional, but don’t try to turn yourself into a home-buying robot. Stick to your guns on what you can afford to pay, but be flexible where you can. Go for the home you want, but be realistic enough to walk away if the deal doesn’t come together.

And don’t give up, even when things aren’t going exactly the way you want. Somewhere out there is the right home for you at a fair and reasonable price!

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