Once you’ve found the perfect Los Angeles house – one that meets all your search criteria: location, features, price range, and so on – you still have one major purchase hurdle remaining. And that is figuring out what to offer for it. You don’t, of course, want to offer more than you have to, but your offer still has to beat out those of other potential buyers. You also can’t allow emotion to override logic either. Today’s real estate market is fairly hot still in most areas, and sellers aren’t usually inclined to negotiate much. So, to help you out here’s how to negotiate the best price for a Los Angeles house.
Determine Seller’s Motivation
Most experts advise that you first try to determine how motivated the seller is. For it does happen sometimes that sellers put a house on the market just to see what kind of offers they’ll get, in which case they really aren’t motivated sellers. Most of the time, sellers really do want to sell, but some are more motivated than others. They may have, for example, already made an offer on another house, they may need to relocate quickly for a job, or they may have just gone through a divorce. So if you want to negotiate the best price for a Los Angeles house, you should have your agent inquire about the seller’s motivation for selling. Motivated sellers are often willing to negotiate.
Make a Realistic Offer
Sure, you want to pay as little as possible, but your offer still has to be in the realistic range in your attempt to negotiate the best price. A low-ball offer is often counterproductive (except in certain specific situations such as a foreclosure or a house that has been on the market for many months because it is overpriced). Very often a low-ball offer will insult the seller, and she may dismiss your offer outright and not come back with a counteroffer. A good agent can conduct a comparative analysis to determine market value and then guide in making a realistic offer. (Call 562-881-9811 to find out more about this.)
Another good tactic to negotiate the best price for a Los Angeles house is to show some enthusiasm. Because the real estate market is moving healthily inmost areas, real estate professionals no longer advise buyers to remain coy about whether they like the house. In fact, sellers are coming to prefer formal bid letters accompanying an offer as a sign of your seriousness as a buyer. Knowing something about you and your source of financing will help them choose from among multiple offers. If you look like a solid buyer and more serious than others, a seller just may decide to go with your offer even if it is a little lower. So it can work in your favor to convince the seller that you just have to have that particular house.
Be Prepared to Walk
The other side of that coin in negotiating the best price for a Los Angeles house is to be ready – and make it known that you will – walk if necessary. Real estate inventory has been low, but it has been increasing. So if you can’t negotiate a reasonable price, you are likely to find another house that suits you. In addition, you should put an expiration date on your offer to create a sense of urgency in the buyer. If your offer is reasonable and the seller knows she has a limited amount of time, she just may go ahead and accept your offer. Standard advice here is to make the offer good for a very short period, sometimes as little as 24 hours.
Many buyers believe that the deal is set in stone once the offer is signed, but that’s not necessarily the case. Many times, the real negotiations begin after that point in the process. In fact, the down and dirty in negotiating often begins only after the inspection. Recommendations include asking the seller “for a cash-back credit at the close of escrow, which can help you complete the [repair] project yourself. You can also ask the seller for a credit to fix certain issues in the interest of offsetting closing costs.”
Use an Agent
Once you submit a signed purchase offer to the seller, along with your earnest money, the seller then has the right to accept, reject, or make a counteroffer. Most often, it will be a counteroffer, and then if you’re really interested in the house, you’ll need to come back with another offer– a negotiations process that calls for the expertise of an experienced agent. If, however, the seller accepts your purchase offer, it then becomes a legally binding contract – and there’s no way to back out without losing a significant amount of money.