How to Negotiate While Selling a Vacant Home

While selling a vacant home carries its own typical challenges, you need to implement the best practices while negotiating. It is natural that the buyer wants to pay as little as possible, and the seller wants to take as much as possible from the deal.   

Proven negotiating strategies can help you prevent losing out on the deal. You must know how to work the psychology of the buyer and what to do when things take a particular turn. Moving ahead with the negotiation process systematically in a well-informed manner shall help you sell the home faster for top dollar. 

a. How to Negotiate with the Buyers

First Listen to the Buyer

Experts often say never make the first offer and let the buyer do it. While this is a proven good advice, there are reasons why this can effectively help with the negotiation process. In the first place, hearing the offer from them lets you take a mid-point and work from thereon.

Usually, people tend to increase or decrease the offers they make in the same fashion the other party does and, therefore, you can proceed with a clue in hand while first listening to the buyer and gaining insight into his psychological mindset.

Whatever the outcome, the person who is making the first offer is definitely in a disadvantageous position and, therefore, you must guard yourself against this mistake. Also at times, there are chances that the first offer the party makes could be better than yours and in this situation you are already a winner. 

Take Advantage of the Power of “Negotiating Silence”

It might be hard to keep your mouth shut during the greater part of negotiating. However, once you make the effective use of what is known as negotiating silence, you are going to benefit tremendously from the deal.

For instance, during the process of negotiation, if you are uncomfortable, you can assume that the other party too could feel the same way. During that moment, let the negotiating silence from your side rule over the situation. As a matter of fact, the other person is most likely to interpret your silence as either anger or disappointment.

Usually, the outcome of this situation could be that the other party shall come out with a concession to break the uncomfortable silence, and you can twist the course of discussion in your favor.

Stay Well Informed

Studies reveal that in more than 95-percent of the negotiations occurring between experienced negotiators, those carrying the most information are the most likely to walk away with the better outcome. While negotiating, it really matters how much you know about the subject of negotiation. It is very important that you know maximum information about the object of negotiation, about the party and their motives.

Negotiations are not always about money. In fact, those negotiations that intend to solve the issues and problems associated with the object are most likely to make more profits.

Insist on the Last Concession

The best part of a good negotiation is to be able to persuade the other party to come out with what best you can expect from the deal. It is all about unconsciously training them to do what you expect. You should be able to do that without them realizing it.

When you are likely to negotiate with a buyer multiple times, ensure you keep insisting on the last concession they are prepared to come out with. This could mean a better price or better terms or anything that will benefit you.

You must be able to make the other party understand that every time they ask for something, they have to give something in return. Once this lesson is driven home, then they shall be forced to reduce the number of demands they have on the table.

Respond with a Penalty on Every Concession Demanded

If you wish to discourage the other party from seeing concessions during negotiations, you respond the same way they do. Whenever they expect a concession, you implement a penalty indicating the each of their expectation shall carry a price (without giving an indication that you are doing it on purpose).

The penalties could be of diverse kinds. For instance, making them wait to hear from you could be an unbearable punishment for them, so they often withdraw their demand for a given concession. The penalty could also be something that they need to struggle from their side which will dissuade them eventually for the fear of getting into the mess and hassle.

Friction is Welcomed

As against what you might imagine, a smooth negotiation process is not necessarily a good one. For instance, reflect on a smooth negotiation you came across anytime in your life. If the other person accepted the offer quickly without any protest or countering, then you are most likely to think that you have landed on a bad deal.

The more the number of frictions in the negotiation, the parties are bound to feel that they have got what best they could.

If you wish to see that the other party does not go back on the negotiation after it is over, then it is important that you make them work hard on the mutual agreement. The hard work involved in this shall make them feel successful in the end.

b. When to Lower or Pull Out

Usually, while listing the property, you would have done enough research to fix the offer price you quote from your side. However, since the price is something that matters the most when it comes to successful deals, you must know when to lower your price and when to pull out of a deal.

Usually, the newly listed properties are likely to attract most buyers. If you did not receive any offers over the first three weeks of listing your home for sale, then you must reflect on the possible reason, and it could be an indication that you must lower the price.

It is a famous saying in the real estate arena that any home can sell provided if the price is right. So, if you do not get any offers despite your best efforts to list your property the most attractive way, then there are chances that the property is priced too high. Though you might have consulted a real estate agent to fix the asking price, you need to be realistic in depending on this figure. Make a thorough comp analysis to review the price.

Also, if all the offers you get are lower than your asking price and the buyer disappeared when you made counter offers, it means you are working with a wrong price tag, and you must consider lowering. During the course of the sale if you happen to discover that the property is worth the price tag you expected, then you should consider pulling the property from listing and wait till the seller’s market becomes better.

The selling price of the home is not what you fix, but what the buyer is prepared to pay for it. Therefore, whether the deal would give the desired outcome solely depends on whether you are able to sell it for what you intended to.

Despite the best of market research and comp analysis, if you get poor offers, it could indicate a sudden slump in the market. Therefore, it is an indication that you need to pull out from the listing and wait for the favorable time provided you can manage waiting for some more time.   

c. Poor Offers

When receiving poor offers, you must know how to deal with them. You need not be offended by a poor offer. Do not take it personally and you need to keep your emotions aside. Make a counter offer and wait to see the results.

Often successful negotiations could turn the poor offers into sale opportunities. If a purchase offer is ridiculously low, then you may reject it outright.

As a matter of fact, several buyers make low offers since they think this is the way things happen in the market. They are afraid they will end up paying more if they make a reasonable offer. Therefore, the very fact that you receive a few offers means buyers are interested in your property and you need to expect them to be low though not laughably low.

The reasonable counter offers you give in response to lower offers are an indication that you are willing to negotiate with the sale. While making a counteroffer, you might consider lowering your price, but ensure it always carries some price like withdrawal of some concessions so that the buyer is made to feel that their expectations will always carry some price.

Often, poor offers can be a positive sign provided the contingencies sound good. For instance, if the closing date is favorable to you and the buyer appears to be preapproved for a mortgage, you may check whether the deal can benefit you in other ways like quick closure if not the price that you are expecting.

Poor offers are an indication that you need to work with your comps once again, or sitting with your real estate agent. If the new comps' suggested price is lower than yours, you need to think of lowering the price. If the buyers have attached some comps, it is worth exploring them with a keen eye and an expert’s understanding.

If the purchase offer is very low and that you really do not have any other choice, it is advisable that you ask your agent to get in touch with the buyer’s agent and make an attempt to narrow down the gap in a way of facilitating a counteroffer. If the outcome of the interaction does not turn favorable, you can reject the offer and wait for the right time.

On seeing some low offers, never give signs of desperation. The buyers always tend to measure your pulse and benefit from the deal using your desperate need to sell the property. Under such circumstances, wait some time, review your strategies and pricing and you will find a solution very soon.

d. Not Enough Offers

As a matter of fact, homes do well in the market when the first impression they create is the best. You might have worked hard enough on fixing the price the right way and would have staged your home properly.

However, if you do not get enough offers, then it is time for you to reflect on a few things and review your whole marketing strategy. Never get emotional over the status. Just stay confident and work on a few things and you shall turn the situation in your favor. Know that houses that are renovated, projected well and are priced slightly below the market trend sell faster than the others that are priced higher and need to be improved.

While location, condition and price are the deciding factors in price, homes that do not measure up to the comps in the locality in the above said regards do not sell. The more it remains in the market, it is more likely that you give way to some doubts whether the home has some faults or issues. Therefore, you should be quick to react to the situation and review the marketing strategies from scratch in consultation with your agent, and things can work once the limitations found are rectified.

e. Dealing with a Poor Market

While you are selling your home, the poor market could mean the buyer’s market is characterized by a higher number of homes for sale than the demand, or homes selling very slowly and the sellers are offering too many incentives to the buyers.

In a poor market, you will find the buyers having an upper hand during the negotiation as they have several choices in front of them. It is very easy for them to back out from the deal and find another choice if the negotiation does not meet their expectations.

If you feel the market is performing very poor and that you can wait some more time, then it is the best thing to take your home off the market and wait for a favorable time to return.

However, if you cannot afford this luxury, then you can implement other strategies including sweetening the deal with a revised and attractive price, attending open houses in your area to explore the strategies that other sellers are implementing, examine the local listing to decide on best practices and the best pricing and consult the real estate agent on some other possible solutions.

Compensating the buyer in some ways and with some incentives can quicken the sale. Little things can help close deals in a poor market, and you must be prepared for some small expenses in this regard. Also, explore how strategies like better staging and better promotion can work.

Work with some accomplished real estate agents and give them enough incentives to push the deal. What you are likely to spend may be worth it if they can complete the deal quickly for as much price benefit for you as possible.

Relates To  -  home seller tips