Negotiations

TWO TYPES OF BUYERS

In residential real estate we are currently experiencing two types of buyers:

• Those fishing for "a deal"; and 
• Those who are actually "looking for a home" to live in

Both types of buyer will start negotiations with a lowball offer, but their response to the Seller's first counteroffer determines their type:

• If they increase their initial offer substantially, they are actually looking for a home, they need a place to live (but of course they are shopping the market);

• Those looking for a deal will increase their offer just marginally or walk away if their initial lowball offer is not accepted... they are in no rush, have no specific time frame in mind, an...

How To Handle Multiple Offers?

And why on earth am I talking about this in a "buyers' market"?

Well, as it turns out, it is not so much a "buyers' market" in certain segments of our local real estate market. Specifically the lower priced home and short sale home segments in each area have seen a lot of activity in the last six months, the former due to the First Time Homebuyer Tax Credit, the latter to the incredible deals that short sale prices seem to offer. The availability of these kind of homes in good shape has dwindled accordingly. And with this reduction in inventory come (you guessed it!) multiple offers, as buyers compete for the few good homes available in their price range.....

"We have MULTIPLE OFFERS!"

This is a dreaded call from your REALTOR if you are a buyer, but a welcome call if you are a seller.

Murphy's Law says that if anything can get more complicated, it will. Multiple offers is one of those situations where many people may freak out because they don't know how to handle them. So here is a brief guideline on how to deal fairly and smartly with this situation to avoid potential problems:

SELLERS

In some (lucky) situations (more common in "hot" property markets), sellers will have two or more competing offers to consider. They have several ways of dealing with them:

• Accept the "best" offer
• Inform all buyers that there are other offers on the ta...

USING CREATIVE NEGOTIATIONS

If a buyer has an 850 Credit Score, 45% downpayment and does not have to sell a home, his/her offer on your home is a strong one! However, many buyers are not in that situation. And while as a seller you would like to get your asking price and no conditions, an experienced agent will prepare you for the possibility of receiving offers that involve less than ideal conditions and may require some compromises.

Successful REALTORS® know how to structure creative offers and do whatever it takes to make a transaction work ("a bird in the hand is worth more than two in the bush"). If a buyer is low on cash, your counter-offer may shift some closing costs to you (the...

Remember the days when you as the Seller told the Buyer to accept all your conditions or else? Those were the days when hard-nosed and belligerant REALTORS and their ambitious clients could get away with anything, and the Buyers would have to swallow it whole!

Boy, has the market changed! Nowadays Buyers have the upper hand, an Sellers and their listing agents need to have a completely different approach to negotiations. The moment a seller appears inflexible or rude, Buyers just walk away from the negotiations (why wouldn't they, there are plenty of options out there for them!).

Today's successful negotiations need:

1. Patience - negotiations take a lot longer to come to fruition, it i...