How to get the price
How Much Will You Pay?
may not be as much as what is being asked! It is time to settle on a price. You
have probably already been through the pre-approval process and know your limit.
Unfortunately, what you can pay doesn't have anything to do with the seller's
price for a particular home. It is a completely different beast.
Your goal as a buyer is to purchase a home for the least amount of money you possibly
can. A seller's goal is to obtain as much money for the home as possible. This
is where settling on a price can become a little dicey.
the Worth Is it really worth what they are asking?
first step is to determine what the home is worth.
because it has a high selling price on it, doesn't mean it is really worth all
Ask your broker to pull up the real estate comps for the same neighborhood as the home you're interested in. The comp (or comparable
price) should be for a home that is in the same neighborhood, with the same amenities
and size. The comps will tell you how high the sales are for that type of home
in that neighborhood. The more recent the comps are the better. You should also
ask to see the original list prices for these homes. This will tell you the percentage
of list price the sellers are receiving. This percentage will guide you in making
your original bid.
Your First Offer Lower It.
you are in a very tight market with little room for negotiating, never offer the
list price in your first offer.
You will want to offer at
least five to 10 percent lower than the price that you actually want to pay.
example, if you want to pay no more than $95,000 then your first offer should
be somewhere between $85,500 and $90,250. This gives you room for negotiating.
Your Maximum Know it before you begin.
know your maximum price before you start negotiating a final price. This will
guide your negotiations. It will also give you a rational, emotion-free bottom
line. You don't want to be cavalier when it comes to your finances. You must be
able to walk away from the home if the price is too steep. In some cases, you
won't have a choice. You can only qualify for a certain amount and if you can't
make up the difference with cash, you are stuck with that amount.
Next Stop: Making the Actual Offer
This is nitty-gritty
on making your offer.
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