So much has changed over the past few years that it’s almost hard to remember what life was like pre-2008. Back then, the real estate market was still hot, prices were on the rise and sellers held a distinct advantage at the negotiating table. When the housing bubble burst, a flood of homes hit the market, and the advantage shifted to buyers. While the current, Central Indiana real estate market continues to favor buyers, negotiating a fair price isn’t always easy.
A big part of the problem is psychological. You see, too many buyers and sellers have polar opposite ideas about what constitutes fair offer. On the one hand are semi-deluded sellers who feel their home is special, and somehow exempt from local market conditions. They’ve invested a lot in their home both personally and financially, and cling to a past that doesn’t mesh with the present. On the other hand are buyers who automatically assume all sellers are desperate and on the brink of foreclosure. They make low-ball offers and think they are doing the sellers a favor. In reality, the truth lies somewhere in between.
Here are Five Pearls of Wisdom for New Home Buyers
Be fair. This might sound like common sense, but it’s true. People don’t want to do business with people they don’t like. If your initial offer is too low, you run the risk of insulting the sellers even if that is not your intention. You may inadvertently polarize them against you, making them much less willing to negotiate with you. If you’re shopping on the north side, for example, and the data suggests that two-story Carmel homes in this neighborhood are going for around $289,000, don’t come in with an offer of $225,000. You’ll only turn the sellers off. On the other hand, no one can rightfully fault you for making a fair offer.
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