Deal or No Deal?

By Raymond Stoklosa · October 6th, 2008

Real Estate Negotiation
One of the statistics from last month that is catching a lot of heat lately is the percent of asking price that sellers in San Mateo County are receiving for their homes. Last month, sellers got an average of 96.6% of their list price on closed sales, but what does that number really mean?

Mostly, this number reflects more realism on the part of home sellers and more aggressive negotiating strategies by buyers. While sellers are seeing that their home values are not what they thought them to be in the new market, buyers are becoming bolder. The days of overbidding $100K on a property and still losing it are over, at least for now, so buyers are taking advantage.

Negotiation is all about leverage and in a buyers’ market, the leverage and market pressure favor the buyer. So today, sellers are forced to accept give-backs that they wouldn’t have considered a few years ago. Buyers who don’t ask for these concessions though, won’t be offered them.

What can you get in today’s market? For starters, closing fees such as title and escrow charges, normally paid by the buyer, are shifting to the seller side of the ledger. Condominium transfer fees and HOA dues are being prepaid to facilitate a sale and sellers have been known to pay for discount points to reduce the buyer’s interest rate, lowering the buyer’s monthly payment. And that’s just the beginning. Pest repairs, new roofs and furnances can really add up, so don’t be afraid to ask to have them included. This market is your golden opportunity.

Don’t get me wrong, you’re not going to get everything you ask for and if you begin to nit-pick too much or too ruthlessly, you may just lose your deal. Your agent is your best guide in determining how far you can push. Find yourself an agent with a reputation as a solid, but fair negotiator and let them work some buyers’ market magic. But the point is that if you are really committed to your own best interests, you need to at least ask. Sellers can always say ‘no’, but at least you know where the line is. If you don’t at least test the waters, you may live with the regret that you could have gotten yourself an even better deal in 2008.

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