Just like in any profession, not all Brisbane real estate agents are the same. When you’re talking in terms of real estate negotiation some agents struggle and others shine. You’ll generally find agents who’ve undertaken tertiary education and received some form of legal and negotiation training, like those at Impact Property, really pack a punch when it comes to closing a sale and negotiating an offer. These types of agents are much better negotiators and far outshine their peers.
Negotiating offers is where the expertise of a real estate agent will really help you. You can maximise your profits by choosing an experienced real estate agent who knows your local market well and is adept at negotiating. When vetting an agent look for someone who has a business, economics or legal background. These people will have the foundational knowledge and the experience in high stakes roles to get the job done.
Assessing the Negotiation Environment
There are many variations that people include in their offers. At Impact Property we negotiate and facilitate these on a case-by-case basis, in close discussion with the seller.
Your Buyer Types
There are multiple buyer types when it comes to real estate negotiations and the buyer type you’re dealing with will determine your approach. Generally buyer types can be group into four categories.
- Emotional Buyers: These are the best buyers form a relationship with as they fall in love with your property and therefore will offer the best price when pushed. We listen to their needs, and focus on why they want your home so much with particular attention to negotiating the most money for your sale.
- Value Sensitive Buyers: Are those who claim to know the market very well and will limit their buying capacity based on their beliefs. These beliefs may or may not be accurate as such some of them can be persuaded by those who can prove superior market knowledge. This is where education and experience in your realtor becomes vital.
- Bargain Hunters: Are those who will offer a price that is opportunist and unrealistic. They have little emotional connection in the property they are buying. These are not ideal buyers and require a strong negotiator who can put them in their place and not fold to them.
You will generally have two offer paradigms to work with when selling a property:
- Multiple Offers: When you receive offers from more than one buyer at a time there is a fine skill in negotiating your property to sell for the highest price.
- Single Offers: When receiving only individual offers at a time your situation turns into the purest form of negotiation, this will require back-and-forth between both parties.
Giving the trained skill of Negotiation a New Edge
Here at Impact Property we like to consider all angles and as such we suggest you consider these additional points during negotiations:
What deposit amounts indicate: Deposits can range from $500 to around 20 per cent of the purchase price. Money talks and a buyer who is willing to put down a deposit is a serious buyer. This is a clear indication the buyer is extremely interested in purchasing your house and seeing the transaction through. This is also a good indication the buyer is financially stable enough to purchase the property. A large deposit shows greater interest, because it indicates the buyer wants to show you how serious they are and they want a fast transaction. A small deposit could also be promising, but it indicates the buyer will most likely need to obtain financing from a third party. This could make the sale slower and more complicated. In many cases you’ll only receive offers with small deposits. However, there are other elements to take into consideration in addition to deposits during negotiations.
Settlement periods: The normal timeframe is four to six-weeks. There can be exceptions to this depending on circumstances and some settlements can range from two weeks to six months.
Fixtures and furniture: You may want to consider selling off your furniture or other belongings that are too bulky or costly to move to your new home. Alternatively, the buyer may show marked interest in a piece of furniture. These will need to be factored into the negotiations.
Cash Sale vs Financing
Some buyers are able and willing to pay in cash. A cash sale will lead to a speedy result, because there’s no need to wait around for approval of financing.
However, buyers who are able to take part in a cash sale also have a distinct advantage, and they know it. They may try to offer you a lower sale price in exchange for a speedy transaction. You’ll need to think about what is most important to you. If you’re in no rush, you could wait for a buyer who offers more money but needs to wait for financing to pay you. However, if a speedy transaction is the most important factor, you may want to accept the cash offer instead. Always discuss what is in your best interest with your real estate agent and ensure they have a clear indication of what is most important to you.
How to Deal with Special Conditions
Offers from potential buyers could include special conditions, which must be followed before the sale can go through. One of the most common examples of a special condition is the requirement that a buyer sells their own house before they buy yours. Other examples include the need to move in right away, or the need to acquire financing with a certain interest rate. These conditions can all be negotiated, so be sure to discuss options thoroughly with your agent.
Don’t Sell Yourself Short
If you are selling your property for the first time, it’s natural to feel excited when you receive your first offer. However, take care not to accept instantly because you’re afraid no other offers will come your way. Because selling your home is such a big transaction in your life, it’s worth holding out for an offer that truly meets your needs.
Countering an Offer
One of the first options in a negotiation is to counter an offer, where you give the buyer a counter proposal. This shows the buyer that you are seriously considering their offer but have a few reservations. The seller might ask for more money, a different closing date, or a higher deposit, for example. Counter offers can buy you more time when you’re selling a home, allowing you to accept other offers and keeping the door open to further negotiation.
By keeping your property on the market for a longer period of time, you can analyse each offer thoroughly.
Accepting an Offer
If you find the conditions offered to you agreeable, then you can decide to sell your house. The next step is settlement, so you’ll need to get in touch with your lender and inform them of the intent to sell. This is the time when all inspections or other conditions of sale must be carried out, with the help of your real estate agent.
Rejecting an Offer
If an offer doesn’t meet your expectations due to its terms and conditions or low sale price, you may wish to simply reject the offer. The last thing you want to do is accept an offer that is disagreeable or incompatible with your goals. While rejecting an offer can mean you won’t hear from a buyer again, the buyer is always able to make a different offer if they are definitely interested in the house. Therefore, don’t feel cornered into accepting a bad offer just because you’re afraid the buyer will lose interest, the buyer might just be testing the waters.
Assessing How Your Agent Takes Their Cut
At Impact Property we excel in is negotiation. Our philosophy is that agent fees are indirectly paid for by the buyer and not by the seller.
However, this won’t be the case for all agents and be wary of the conditions before signing. It is rare that commission is not covered in the difference between the buyers first offer and the sale contract price, which is what makes our service at Impact Property so great.
If you have any concerns talk to the agent directly about the transparency in their agent fees, or talk to a trusted third party about it.
Finalising the Sale
Once you have negotiated and accepted an offer, the next step is to sign the contract; this is where having a real estate agent on your side is important. The agent will ensure all necessary inspections are followed through with, including any maintenance or repairs. This could relate to your plumbing, gas, or electrical systems. It’s important to note expenses for necessary repairs will be taken out of your final settlement.
Should major structural problems be found by a contractor, the buyer can always nullify the contract and further negotiations may be necessary in this case.