The brokers and sales associates at Orange Key Realty take their roles quite seriously, especially when negotiating for their customers’ to create a win-win situation. “Today’s customers are more apt to be versed in the process of negotiating real estate and we are poised to become their customers ‘champions,’” stated by Mike Matthews, broker/owner. “As champions to our customers, we are vested in a successful outcome by guiding them through, what at times may seem, a challenging process.”
“Our knowledge of a changing marketplace is the key advantage to how we negotiate on our customer’s behalf, after we have built communication and trust. As part of our commitment to our present, past and future customers, we know the following information will be helpful in decision making circumstances,” broker/ owner Ofir Hillel added.
Whether you are a buyer or a seller, you want to succeed in the realty marketplace. That’s natural and reasonable, but what are the steps you need to triumph? Negotiation is a complex matter and all transactions are unique. Both sides — buyer and seller — want to feel that the outcome favors them, or at least represents a fair balance of interests. In the usual case there is a bit of bluff, some give-and-take, and neither party gets everything they want. Developing a strong bargaining position: Some basic keys
1. What does the market say? At various times we’re in a buyers’ market, a sellers’ market, or a market where housing supply and demand are roughly equal. If possible, you want to be in the market at a time when it favors your position as a buyer or seller.
Because all properties are unique — it is possible to buck general trends and have more leverage than the marketplace would seem to allow. For instance, if you have a property in a desirable neighborhood with few sales, you may be able to get a better deal than elsewhere. Or, if you’re a buyer who can quickly close, that might be an important negotiating chip when dealing with an owner who just got a new job 500 miles away.
2. What are the details? A lot of attention in real estate is paid to transaction prices. This makes sense, but the key to a good deal may be more complex.
Consider two identical properties that each sell on the same day for $275,000. The houses are the same, the sale prices are the same, but are the deals the same? Maybe not. For instance, one owner may have agreed to paint the property, replace the roof, purchase a new kitchen refrigerator, and pay the first $3,000 of the buyer’s closing costs. The second owner made no concessions.
In this example, the first house was actually sold at discount — the $275,000 purchase price less the value of the roof repairs, closing credit, and other items. If you’re a buyer, this is the deal you want. If you’re a seller, you would prefer to be the second owner and give up nothing.
4. What about financing? Buyers who are prequalified or preapproved (these terms do not have a standard meaning around the country), at least have some idea of their ability to finance a home and know that they are likely to qualify for certain loan programs.
The result is that prequalified buyers represent less risk to owners than a purchaser who has never met with a lender. If the seller accepts an offer from a buyer with unknown financial strength, it’s possible that the transaction could fail because the buyer can’t get a loan. Meanwhile, the owner may have lost the opportunity to sell to a qualified buyer.
The lower the interest rate, the larger the pool of potential buyers. More buyers equal more potential demand, which is good news for sellers.
5. Who has expertise? Imagine you’re in a fight. The other guy has black belts in 12 martial arts — and you don’t. Who is going to win?
Brokers/sales agents have long represented sellers, and now buyer brokerage is entirely common. In a transaction where one side has representation and the other does not, who has the advantage at the bargaining table?
Orange Key Realty’s staff of sales and broker associates can be reached at either 863 Georges Road, Monmouth Junction, (732-297-6969) serving Middlesex County, and 60 Main St., Freehold, (732-863-6699) serving Monmouth County.