In today’s market, BUYERS need to be aware of seller turn-offs that may keep them from getting the home, best price & terms, and to circumvent complicated dealings.
1. Trash-talking. Some view one way to negotiate the list price down is by slamming the house. This strategy never works and causes the seller to be defensive. Sellers – avoid being at home while the home is being shown. Buyers – save your commentary for your agent. If an encounter with the seller occurs, keep conversation respectful and avoid critiquing the house or listing price.
2. Being unqualified for mortgage financing. There is nothing worse than having a home under contract, then having the whole thing fall apart when the buyer’s loan falls through. Sellers – Work with your agent to check your home’s buyers’ qualifications, including their loan approval. Buyers – Get pre-approved and don’t buy a car, quit a job, or do any other financial moves during the purchase process.
3. Unjustified lowball offers. Sellers generally know the worth of their home and amount needed to get their mortgage paid off so submitting lowball offers is not generally a successful strategy. Sellers – Try not to get emotional – counter at the price you decide makes sense based on motivation level, recent comps and interest/activity level. Buyers – Be knowledgeable regarding comparables (similar recently sold homes) before making an offer. Lowballing may not get a response.
4. Renegotiating mid-stream. If there is a contract to buy a home and during inspections realize costly repairs need to be made, then propose a lower sale price, repair credit or even actual repairs to the seller. But if a buyer is aware the property needed work before making an offer, and then comes back asking for excessive credit or price reductions midstream, expect the seller to bulk. Sellers – avoid mid-stream price renegotiations by having a full set of inspection reports and repair bids when listing. Buyers – avoid renegotiating the entire deal unless you get major surprises in the inspections or inflating small repairs to justify a major price cut.
5. Misleading the seller. Do not offer over asking price with plans to hammer the seller for a reduction when the house doesn’t appraise at purchase price or make “as-is” offer planning to ask for credit towards every tiny repair noted by the inspector. Sellers – Consider requesting proof the buyer has sufficient funds for the difference between what the home may appraise for and the actual sale price and statements verifying funds. Buyers – Don’t make offers with terms designed to intentionally mislead –negotiations can end if the bluff gets called.