Selling your home is a business transaction. Although it may be a multi-layered process that feels personal for you, it’s simply a buyer negotiating to purchase a seller’s home for an agreed-upon price. You, as a seller must keep this fact in mind. Opinions, emotions, and ego may attempt to derail your efforts; don’t let them.
The more you know about negotiating, the less likely you are to create a needless detour during the sale process.
- DO LET THE BUYER SPEAK FIRST
Let patience be your guide when dealing with an interested buyer. Don’t be anxious to tell him or her what you’re willing to accept; it may be lower than the buyer was willing to offer! Like any sale transaction, buyers have a price in mind, even if it is a lawn mower at a yard sale. They might be willing to pay $200 for the mower, but when they ask, you say $125. Do not lose the advantage of being able to counteroffer. Let the buyer speak first. That’s why it’s called an offer. It will either be an offer you can accept, or you will at least have more knowledge about what price the buyer has in mind.
- DON’T “MEET IN THE MIDDLE”
Even in the simplest of sales transactions, agreeing on a price often includes “meeting in the middle.” For instance, a buyer speaks first and offers to buy an item for $150, when the seller is expecting to sell for $200. Most sellers will split the difference and counteroffer $175. The seller should instead counteroffer with $220, which keeps the midpoint at $200. The buyer may take the offer or agree to $205, which is slightly more than what the seller planned to ask for. Maximize your negotiating by counter-offering in small increments. Avoid following human nature by “meeting in the middle.”
- DON’T ACCEPT LOW-BALL OFFERS
Homebuyers look for deals. Think how quickly you would jump at a home selling below market value and in perfect condition that meets your every need. That situation rarely happens, but that doesn’t mean buyers won’t make low-ball offers. If they see your house as the perfect home, they may switch their priority to getting a lower-than-market-value price in negotiations. If buyers truly like your home better than any others, then why would they pay less for it? Keep your focus and negotiate accordingly.
- DO BE QUIET AND LISTEN
Whether you are approached by the buyer or the buyer’s agent, remaining quiet is one of the best ways to negotiate the sale. Developing a feel-good, overly friendly relationship with either can interfere with your focused efforts to sell your home quickly and for a fair price. Buyers uncomfortable with your quietness may want to break the silence by giving information that would be crucial to know. Again, the more knowledgeable you are about the buyer — rather than the other way around — the better poised you will be in negotiations.
- DON’T BE MOVED BY AWKWARD SILENCE
When you are negotiating and the buyer makes an offer, don’t feel compelled to respond immediately. Whether it be 10 seconds or 10 minutes, make the buyer or their agent speak first. They may see your silence as disappointment, and choose to revise the offer or offer a concession just to break the silence. Do not let experienced negotiators use this tactic to get you to accept successively lower offers without a counteroffer from you and your agent.
- DO LEARN WHAT MOTIVATES THE BUYER
Sometimes buying agents will work to learn why you want to sell your home. Agents know that sellers want to go to escrow only once. If the buyer is advised to demand a lower price because of minor defects discovered during a third-party home inspection, they will use this as a negotiating tool. More importantly, an agent for the buyer may advise his client to offer the asking price, knowing that minor flaws exist, only to later demand reductions to bring down the final sale price. Knowing that situations like this happen, don’t let the process of selling your home wear you out. Don’t compromise your time and effort to keep things moving in escrow. Your listing agent should suggest a home inspection before you list to avoid trouble when negotiating the sale.
- DON’T FREELY GIVE OUT YOUR INFORMATION
If you have multiple offers on your home, the price is not always the bottom line. Sometimes, what you tell the buyer will influence his/her offer. For example, let’s say you have two interested buyers. One buyer offers full asking price, thinking that you will readily accept, but tells you she needs a few months to get financing finalized or to get inspections. The other buyer offers $10,000 less than your asking price but agrees to close quickly without any financial or inspection contingencies. While the first buyer offered more money, the second buyer was more appealing time-wise. If you were under a time constraint, the second buyer solved your problem.
- DO GET THE LAST CONCESSION
Remaining calm and focused during the counteroffers is the key to getting the last concession. By asking the buyer to give something in return every time he or she comes back with another request, you gain the upper hand, and the buyer will start backing away from making nonessential demands.
- DON’T BECOME FLOODED WITH CONCESSIONS
When a buyer submits an offer to you, unless it’s a fantastic one, you should bring counteroffers to the table. Perhaps a different price and/or concessions — such as shorter closing dates, terms, modifications of contingencies, or incentives — will enter the negotiations. When reviewing the offer, be sure to consider items that would be unacceptable to you. A counteroffer is used to, in effect, accept some (or most) of the terms of the buyer’s latest offer, while modifying other items. Since there is no limit to the amount of times counteroffers can be made, make sure the buyer will have to wait for your response. Your eagerness to respond may be interpreted as desperation on your part, which, in turn, may give the buyer more leverage.
- DO MAINTAIN A BUSINESS DEMEANOR
Remind yourself that you want to sell your home for the best price and in the shortest time. Seller/buyer relationships come in all shapes and sizes, but no matter what ensues, selling your home is a legal, documented business transaction. Home selling has a way of sneaking into one’s emotions and triggering negative responses. If the buyer has an inflated ego and acts like a know-it-all, you need to make sure it does not affect you. On the flip side, if the buyer comes off as the sweetest, kindest — but somewhat financially troubled — person you’ve ever met, do not let that dissuade you from your goal of getting a fair deal.
Stay on your toes, even if the sale is going along quickly and painlessly. Sometimes, it’s an indication that the buyers might back out of the deal. There needs to be a certain amount of discussion by both parties to keep the buyer from jumping ship or, on your part, feeling seller’s remorse. You may sense afterward that the buyer would have been willing to pay more for your home.
- DON’T LET YOUR EGO GET THE BEST OF YOU
During negotiations, there may be a time when you think of all the labor and time you have invested into getting your home sold. Hours upon hours spent cleaning, staging, showing, and communicating may suddenly flood your mind. You may wonder if it was in vain when faced with buyers who are critical, demanding, or rude. Retaliation in a like manner can break a deal, so learn to deal with potential homebuyers objectively. Don’t let your ego get in the way of a good deal.
- DON’T AVOID QUESTIONS: KNOWLEDGE IS POWER
Don’t avoid questions. Don’t be unfriendly or uninterested. However, remember this is a professional transaction between strangers, and don’t be unnecessarily forthcoming, either. When the buyer asks what appears to be a tough question that may relate to an offer, she is looking for direct answers and your reactions. Stay professionally reserved and avoid showing anxiousness to sell. A simple but effective technique for handling a tough question without giving out information is to answer with another question. If you are asked if your home has been long on the market, simply answer imprecisely, e.g., “Not long.” Then calmly ask the shoppers how long they have been looking. Their answers may empower you with information about their own stress points. The more knowledgeable will overpower the less informed at the bargaining table. The more insight the buyer has into your motivation to sell, the more powerful he or she is at negotiating.
Dealing with the buyers, keep this objective in mind. Answer questions thoughtfully but vaguely, without revealing much. Managing your responses by asking them questions in return works well. Always attempt to get the other party to reveal their thoughts.
