The Process Of Offers & Negotiations

Offers and negotiations are the heart of the real estate transaction, which after all is a process whereby two parties come to agreement on a wide variety of different factors which all add up to a single transfer of property.

In this process the positions of the two opposite parties are almost always the same, time after time. The buyer wants the property for the lowest possible price and with the greatest number of contingencies to protect their interests, while the seller wants the highest possible price and doesn't even want to think about any contingencies which could cancel the deal once underway.

Most sellers will be inclined to accept a lower price for their properties if the deal is virtually contingency free, and will want more money the more contingencies are piled on. Therefore, the art of negotiating an offer can often call for finely honed skills and extensive experience on the part of your real estate agent.

From both the buyer's and the seller's side it is absolutely imperative to stay calm and subdued throughout the entire procedure, no matter how gruelling it can become. As soon as emotions come into play, logic is overruled and an otherwise good deal for both parties can turn into a conflagration. People become emotionally attached to their possessions, and buyers have to understand that factor. A buyer should be willing to cope with a seller's demand for one particular aspect that is of specific interest to them as long as it can be compensated in another aspect of the negotiation.

One of the most contentious issues to be negotiated in any real estate deal is the contingency that the buyer's current home must be sold. It is quite rare to find a seller who is willing to place their property in a Sold On Condition status and possibly lose another buyer who is ready to move on the deal right now, without incorporating a rather hefty escape clause. These escape clauses typically take the form of providing the buyer with two or three business days to increase their offer should a competing offer be presented to the seller. Of course the buyer wants to avoid this clause as it can call for them to put up more money, and even guarantee a date for the sale of their own home, which may be well nigh unpredictable.

Contrary to conventional wisdom very few sellers knowingly mislead buyers on the condition of their property. Home inspections have become so universal and held to such high standards, that the seller who manages to pull a fast one on both the buyer and the home inspector is rare indeed. Therefore a wise seller must be aware of the cost of the repairs which the buyer is going to demand after reading the home inspection report, and be willing to allow for a suitable adjustment in the price.

Real estate negotiations must never be taken personally, as it's only business. If you keep a cool head and conduct yourself with the proper balance of flexibility and enlightened self-interest, you cannot fail at obtaining the house of your dreams at a fair market price.