Finding the right house can take weeks or months, but as soon as you find ‘the one’, you need to know the exact steps to follow to make sure you secure your dream house. One of these steps is knowing how to negotiate on price.
Before the viewings
Know the market
Keeping an eye on the local market is always key. If similar properties in the area aren’t selling quickly, or if they’re selling below the guide price, you know you can sensibly offer less than is being asked.
Local property listings are always in the local press as well as online, such as Rightmove and Zoopla. These sites will also give you the last sale price for the home you’re interested in, as well as the most recent prices paid for properties on the same street. It means if next door sold for £25,000 less last year than your vendor is asking for today, you can use this information to aid negotiations in your favour.
Consider the vendor’s financial position
Knowing what your vendor spent on the property can be incredibly useful information. If they bought the house over 15 years ago, it’s likely they’re sitting on huge gains with a much smaller mortgage. As a result, they’re likely to have a more flexible mindset as to what they’d accept. If your vendor has only recently bought the house, it may well be that they need to accept a certain offer to simply cover their existing borrowings.
During the viewings
Use any face time with your vendors to find out about their situation. Why are they moving and where to? What you want to uncover is how urgently the vendor needs to sell. For example, if they’re trying to move to a better school catchment area, they’re likely to be keen for a quick sale compared to a older couple who are simply downsizing. It’s also great news for you if they’ve already agreed a sale on their next home – they won’t want to lose out on their next home for the sake of negotiating too hard.
It won’t always work and you may not always get a truthful answer, but simply asking the vendor or the estate agent what the minimum price they would take can shift the goalposts, hopefully in your favour. You may feel uncomfortable asking such a direct question but you may just be surprised on the answer you get – if you don’t ask, you’ll never know!