Negotiating Strategies

Properties are bought and sold in New York City every hour. Most people feel that prices are fixed and that once you decide to purchase a specific property the price you pay is set. In 2011 – 98% of sales closed below the asking price. If the buyer and their broker negotiate correctly, in some cases, properties can sell well below the asking price.

Negotiating properly also applies for the seller. Right now many properties are selling for over their asking price. This is not because buyers are calling up and saying that they will pay more than what is asked but that there is a great broker working for the seller to negotiate that price above its asking point.

Helpful Tools for Negotiating:

1) Be prepared. It is not always the price that a seller is interested in; they also want to make sure that you can close. When submitting an offer, send a complete signed offer sheet that fully discuses your financial situation and ability to purchase the stated property. Include with the offer, if financing, a copy of your signed preapproval letter. If a seller believes that you are very solid financially, they are more likely to lower their price faster for you than for a less qualified applicant.

2) Be courteous and outgoing. Sellers and their brokers can sometimes be difficult. They may be in fact impossible to deal with. But remember you are not buying them, you are buying the property. In this case you must realize that if they are difficult with you they are difficult with other buyers. If you are the buyer who is able to deal with them the best, you may have a very positive outcome. We have worked these types of sales several times and can go over examples that have saved our clients over 15% off the current market values.

3) Be informed. The more you know about a situation the better equipped you can be to work your offer. Many times we are able to obtain information on a current sale that is not public knowledge. For instance, if a seller has maximized their time to sublet a particular property and a buyer knew this information, then they could negotiate accordingly, pushing the price in their favor.

4) Know when to be aggressive. Being aggressive works often, but is not always the right strategy. Unless you know exactly what the other interests, offers, and conditions the seller is currently dealing with, you should not use this strategy. If a seller feels that they can do better or does not need you as a buyer, they may choose to let you go. But if the situation calls for it, aggressive offers, when presented correctly, can be a great way to negotiate the price in the buyer’s favor.

5) Timing. Many sellers are looking to close as soon as possible. But at least 25% of sellers have other factors affecting their timeline. If you know these factors and can use your purchase timeline to compensate for the seller’s timeline, you may be able to once again get your desired property at a slightly discounted number.
These are all key factors to be used when negotiating your purchase. A great agent will use all of these tools throughout the entire negotiating process. When we represent buyers, our negotiating strength is a key reason why buyers return to our services time and time again.