For Sale by Owner News and Articles
Holding the Line On Your Asking Price
By Broderick Perkins
We may be in a buyer’s market, but you can still close the deal without lowering your price.
If you have evidence supporting your asking price, including an appraisal, comparables, recent asking prices of nearby homes and a handle on current market conditions, you've got the battle half won.
Here are other strategies that can help you hold the line when the buyer wants a piece of it. Remember, whatever concessions you make, put them in writing as part of the sales contract.
-- Negotiate with someone else. Unfortunately for sellers, the plain truth is that buyers rule in many markets today and they've got the option to simply move on to a more cooperative seller.
-- Negotiate the terms. Offer to move out in 30 days instead of 60, close escrow earlier and give the buyer the home sooner.
"Terms are just as important as price," says Robert Aldana, a Seville-Contempo agent and host of "Let's Talk Real Estate" an AT&T Cable community television program in the South San Francisco Bay Area.
-- Negotiate with cash. An effective financial inducement, especially for buyers short on down payment money, is to offer to pay a portion or all of his or her nonrecurring closing costs. Such costs can amount to 3 to 5 percent of a buyer's total purchase price and include loan origination fees, title insurance, property inspections and the like.
If you'd rather not come out of your pocket for the buyer, suggest he or she check with the mortgage lender to cut or eliminate the loan originate fee in exchange for a slightly higher interest rate. Also consider offering the buyer more money for the down payment in the form of a seller-financed, low-interest "carry back" loan, which finances a second mortgage.
"A home seller who takes back a mortgage on his own property to assist a buyer has the right to foreclose and retake the property if the buyer defaults on the loan," says Sacramento attorney Michael James Bryant, author of "The Legal Edge For Homeowners, Buyers & Renters" (Renaissance Books, $15.95).
-- Negotiate with stuff. Consider paying for repairs found necessary in the inspection report, leave all the major appliances behind as well as window covers, and other items you previously decided to take with you.
"Buyers always like to have a little extra money to pay for repairs but the lender won't allow you to credit them the money," said Arnie vonMassenhausen a broker with Online Capital in Cupertino.
-- Negotiate using an expert. Hire a professional, say a real estate attorney or other professional who has real estate transaction negotiating skills, but not the emotional ties you have to your home.
"Unlike you and the buyer, a good negotiator won't take things personally. They aren't the ones who spent three months looking for appropriate wallpaper for the den. Objectivity is easier," said Ray Brown, San Francisco broker and co-author of "House Selling For Dummies" (IDG Books, $16.99).
Broderick Perkins, has been a consumer journalist for 20 years. Experienced in print, electronic, and consulting journalism, he is chief executive editor of San Jose, CA-based, DeadlineNews.Com, an editorial content and consulting firm.
© Copyright 1999 by Broderick Perkins. All Rights Reserved.