Selling your home is a huge financial transaction, one that may impact your life for years to come. So, naturally, you want to sell for the highest price possible. With the current strong seller’s market, buyers are being cautioned to make conservative offers. Consider this from Credit.com: “[B]efore you jump in with an offer . . . above the asking price, it’s good to take a moment to consider if the house is also a wise investment.” Although it’s a seller’s market, you’ll still have to negotiate. Here, then, are some negotiation tips for getting the best price for your Chicago house.
Many times sellers don’t accept a buyer’s first bid, so counter offers are common in the negotiation process. Buyers expect this back-and-forth and often make an initial bid lower than the list price and lower than they are actually willing to pay. As result, most experts recommend as one of their negotiation tips to counter boldly.
Sellers often come back with a counter offer that is higher than the bid, but lower than their asking price. This strategy will get the property sold, but it won’t get you top dollar. Timidity in counter offering really isn’t the best practice.
So when a buyer makes an offer below your price, you should counter at or even slightly above your asking price. If the buyer is really motivated and truly interested in your house, this counter won’t scare her away. She will come back with a higher offer – maybe not as much as you want, but higher than the initial bid. When you counter at near your list price, this sends a signal that you know your property’s worth and that you will hold out till you get the price you need and deserve. This strategy will also cull the not-so-serious buyers and the bargain hunters before you get too deep into the process.
Set a Deadline for Your Counter Offer
Another of the effective negotiating tips for getting the best price for your Chicago house is to lay down an expiration date for your counteroffer. The reason for this is that when you make a counteroffer, you are actually entering into a legally binding agreement with the buyer not to accept a better offer that comes along. With a deadline or expiration date, you won’t be hooked into that agreement for an indefinite length of time.
A short deadline for your counteroffer will also force the buyer’s hand, causing her to make a decision, instead of dithering. In addition, this deadline will encourage other potential buyers to make offers because they know that you’ll be able to consider their offer within a few days. Without that expiration date, many buyers will be reluctant to make an offer while negotiations with another buyer are in progress. And, as always, the longer your home is on the market, the less desirable it will seem.
Now, here’s one of our negotiation tips that isn’t for the faint of heart, but it can work. And that is simply to reject a low offer outright and don’t make any counteroffer. Then, you ask the buyer to submit another offer. If the buyer is genuinely interested, she will come back with another, higher bid.
This strategy also sends the message that you understand what your property is worth and that you aren’t willing to settle for less. It also keeps you from getting locked into the negotiating process so that you will be able to entertain other bids. This situation can put pressure on a buyer, and she will know that she has to quickly make a competitive bid.
Pay for Closing
This is one of the negotiation tips that proves the principle of reciprocity. If you’re willing to give something, you can get something in return. So offer to pay the closing costs. This typically amounts to about 3% of the purchase price, but paying these costs may get you the price you need for your house.
Buyers may not have the cash to pay closing costs, but they can usually get the mortgage loan to purchase your house. So if you offer the pay closing costs, you will likely get your price with cash-strapped buyers. When a buyer makes an offer and asks you to pay closing costs, you can indicate that you are willing to pay these costs, but at a higher purchase price. You give a little in order to get much more.
Offer a Good Product
All of these negotiation tips for getting the best price for your Chicago house assume that you are offering a superior product – your house. That means, of course, that is in the best shape possible and has features that make it more attractive than competing properties. But it also includes superior marketing and presentation, those aspects that a knowledgeable agent can help you with.