There is an old adage in real estate and life that time kills all deals. This applies to buyers and to sellers, equally, but we will focus most of our attention on the buyer perspective.
When negotiating, most people think a long hard-fought negotiation will allow them to get the best price, but we would argue on average this is not the case. Buyers who realize that a property is a great deal and act quickly to scoop it up are usually the most successful.
Long negotiations usually don’t end in good outcomes and industry experts will be the first to tell you this as it opens you up to risk of competition.
Understanding what something is worth via a comparable analysis is very important and allows you to move quickly because you have done your homework before making an offer. You can map out the scenarios of your negotiation strategy before your initial offer. Once the counter comes in, you will be mentally steps ahead, enabling you to move quickly with an increased offer or feel comfortable staying firm on price.
We believe it is a best practice to be able to counter with your next number within 24 hours. Grounding your decisions based on the data of comparable analysis helps to remove the emotions of negotiation and to allow you to follow your negotiation plan. This will also help you avoid overpaying or having buyer’s remorse.
On the other end of the spectrum, if you can’t defend your price with a recent closed property that is similar to the one you are bidding on, you may not be realistic in what price you are expecting to get – even in a more negotiable buyer’s market. The conversation between the seller and listing agent may raise questions about how serious of a buyer you are.
Everyone wants a deal but don’t expect sellers to give away their most expensive asset, unless there are clear signs of a distressed or urgent sale. For example – relocation, divorce, financial troubles, etc.
The real estate market is generally efficient, especially in large metropolitan areas like New York City. If you saw a listing that looked like a value, you can be sure that many others have too. Just because the listing agent hasn’t told your agent there is another interested party or offer doesn’t mean that other interest doesn’t exist.
Don’t live in fear but you need to keep that in mind. If something is going to sell at an amazing price, the listing agent wouldn’t be doing their job if they weren’t shaking every tree in their network to try to find other interested parties.
We have seen several scenarios where a buyer waited too long to make a decision in the final stages of a negotiation and suddenly found themselves in competition with another buyer. Losing a property under these circumstances can be avoided by making timely decisions based on your negotiation strategy.
Buying a house or apartment is a huge financial investment, but also keep in mind that you are buying your home. If you know the market and have been looking for a while, be honest with yourself when something special comes along, and don’t miss it over a small amount of money that will be amortized over many years.
Unfortunately, most buyers don’t learn this lesson until after they’ve let a great apartment get away. To avoid learning this lesson the hard way, let your agent know when a property feels like “the one” so you can be the one who takes it off the market.
It’s important to understand how your emotions can unnecessarily influence a transaction. Excitement turns to anxiety, turns to anger, which turns to rage and back to bliss and back to the beginning.
While you may be communicating via your agent, you are negotiating with a person on the other end of the transaction. It is important for everyone in the deal to feel like they’ve won in the end.
The smoothest transactions are the ones that occur when the buyers and sellers act like adult and both sides feel like they won in the deal. Nobody likes a jerk!
In New York, an accepted offer isn’t binding. You can’t feel comfortable until your unit is in contract. That can take a couple of days to a couple of weeks, depending on the diligence and speed of the attorneys.
There are times to ensure your lawyer dots every “i” and crosses every “t”, but it is not uncommon for deals to be torn away (even after an accepted offer) because another higher offer comes along. Make sure to check in regularly with your attorney and be responsive to his or her requests, so you can get in to contract as quickly as possible.
Having a knowledgeable buyer’s agent and a real estate attorney who can move quickly can keep a deal on track. Delays on an inspection or slow handling by an attorney could blow up your deal as it leaves time for competition to step in.
In closing, surround yourself with a highly recommended professionals that are known for getting deals done in a timely manner and you’ll succeed.
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