Have you had your eye on a house, but it’s “a little short”? Or would you like to “win in price” a little, and leave the saved part of your “hard earned money” for other needs? Don’t know how you can buy the long-awaited “roof over your head” for less than what the seller asked for? Then this article is just for you!
Over the past decade, a lot of real estate has been built in Russia to suit every taste, but the difficult economic situation and constant fluctuations in the ruble exchange rate have had a significant impact on purchasing power. All this led to the fact that there were significantly more sellers than buyers in the real estate market. Therefore, there will always be those who will give in on the price, which will make it possible to buy a good house cheaper than its market value.
In this article, we will look in detail at how to bargain correctly when buying a house, as well as techniques and ways to reduce the price and buy the property cheaper than it was offered by the seller.
Analysis of offers on the real estate market
Due to the crisis in the economy, the development of the real estate market in our country continues, but according to a slightly different model:
- the average cost per square meter decreases;
- Mortgage rates are falling;
- The population of cities is growing compared to rural areas (relocation of people from villages to cities).
Traditionally, the highest demand is for budget houses. There are a lot of buyers here and bargaining is not easy, but real. Developers and realtors, in turn, trying to extract more benefits for themselves, deliberately inflate the price, clinging to any advantages: proximity to a forest, to a train or metro station, location within the city or, conversely, distance from it.
Considering all of the above, every buyer needs to know how to reduce the price and be able to bargain when purchasing in order to buy a home cheaper. What actions should be taken?
When starting your home buying journey, the first thing to do is set your price limits. Decide what is the maximum amount you can spend on purchasing a home. The payment method should not matter - cash, credit, mortgage - the maximum price you set should not be exceeded.
At first, it would be better to assume the worst and not immediately count on receiving a discount or the opportunity to bargain, because during negotiations the seller may not concede the cost of the transaction due to some of his principles.
Complicated deal
The price of the transaction can also be affected by the owner’s readiness to vacate the apartment: whether the seller and his family members have been discharged, when they are ready to move out, whether all documents are ready for the transaction, says Sergei Zainullin.
If the transaction is alternative (this is when the property owner sells his apartment and at the same time buys another. Unlike a free sale, there are several participants in this transaction, and it can drag on for several months), this is a clear reason to ask for a price reduction.
“The complexity of the deal may be grounds for bargaining. For example, a counter purchase, an apartment in encumbrance, a large debt on utility bills and the inability to pay before the deal is reached,” points out realtor and real estate investor Artem Soshnikov .
Calling owners and realtors
Once a short list of options of interest has been formed, you can start calling. Remember: when contacting the seller, do not let him infer your good financial situation. In negotiations, do not bring up topics about your expensive purchases, travel, gifts, etc. Don't discuss your favorite luxury car with him. Concluding that you are a person with financial wealth, he will not lower the price of the apartment.
Keep in mind that developers and real estate agencies are well versed in the psychology of a potential buyer. Taught by experience and practice, they easily get the buyer to spend more than he initially planned. In addition, the income of realtors and agencies is part of the cost of the home sold to you, so they are very interested in selling you as much as possible.
If you want to buy a house at a profit, don’t pretend to be a rich guy. In this matter, it is better to look like a “poor relative.”
Looking for flaws
A rare apartment has no flaws. In one there are old pipes, in another the wiring has not been changed, the windows of the third overlook the entrance canopy... All these are reasons for bargaining.
“The basis for reducing the price is the obvious external defects of the apartment: traces of a leak on the ceiling, foreign smell, weak water pressure in the tap, old wiring, pipes in critical condition,” lists independent financial expert Alexander Pateshman .
When is it most likely to reduce the price when buying a home?
There is always a chance of getting a discount when buying a home. But there are some moments at which this probability increases significantly.
1. Firstly, as mentioned above, often in the text of the advertisement the seller indicates the possibility of bargaining . You need to bargain based on the price indicated by the owner as the cost of housing.
2. Secondly, you can find (albeit with difficulty) when a house is sold not through a real estate agency, but from a private owner , who may not know the current prices on the market and therefore, perhaps, will give in and give a discount.
3. Thirdly, when the home owner, due to circumstances, urgently needed money . And therefore, he is ready to significantly concede the price to the real buyer, but subject to a quick transaction. An urgent sale of a home is generally the most successful option, in which bargaining is not only appropriate, but there is also a high probability that the buyer and seller will quickly agree on a price.
Arguments for reducing prices
Each house has its own shortcomings, skillfully pointing out which you can get a discount.
Important! If the owner reacts negatively to the offer of bargaining, there is no need to turn around and leave; you need to give weighty arguments.
So, among the arguments we can highlight:
- The buyer agrees to immediately execute the purchase and sale agreement and complete the transaction.
- The buyer can pay all costs for re-registration of the property.
- The required amount is already on hand and the client does not need time to collect it.
- The buyer is ready to wait until the owner moves out or settles other formalities.
- The future owner can help with the owner's relocation.
Important! When trying to bring down the price, you should try to indicate your cost as softly as possible, for example: “what price will we stop at?” Offer your price, leave your contact details. Even if the owner doesn't agree right away, you will be the first person he thinks of in case the house doesn't sell.
How to bargain when viewing a home?
If the stage of selecting the right property has been completed and now all that remains is to persuade the seller to give you a price, then the following points will help you do this:
1. Find housing flaws . Carefully inspect your future purchase. During negotiations, delicately point out to the owner all the shortcomings found. It could be:
- Lack of repairs;
- There is a road/railroad nearby with noise and dust from busy traffic;
- Very low/high ceilings;
- Malfunction of heating / water supply systems;
- Old wooden frames/doors;
- Dilapidated condition of the building;
- Distance from kindergarten/school/bus stop, etc.
Let the seller know that you are ready to purchase this property, but want to receive a discount on it due to the deficiencies found.
2. “Service for service” . It happens when an owner wants to sell his home and immediately buy another one. But between purchases he has nowhere to live. You can allow him to occupy your apartment for a certain period of time, in exchange for receiving a discount on the purchase of housing from him now.
3. Discount for efficiency. If the seller, for some reason, wants to quickly complete the transaction and put an end to the “paperwork” (let’s say he has an urgent trip, needs to quickly make an advance for another house, urgent business matters, etc.), then you need to discuss with him, Is he ready to reduce the price a little for speed of action? Perhaps he will even be happy with such an offer and his desires will coincide with your capabilities.
4. "Dead weight" . Has the apartment that you are interested in been “hanging” among the advertisements for a long time? Realtors and the owner have not been able to find a buyer for several months now? So let them know that you are ready to buy this home now... but with a price concession. Most likely, the decision will be made in your favor.
5. “It’s cheaper there . If you have a similar home option in mind, but the price is lower, be sure to mention this in the conversation. Offer the seller to give you a discount. If he is interested in selling, he will certainly agree.
Inspection of the premises
Carry out the inspection only during the daytime - in the evening it is easy to miss many imperfections. Check everything as carefully as possible.
What you need to pay special attention to:
- Windows and window sills. If there are no plastic windows, carefully check the frames for cracks, pull the handles, and see if the sashes open well. Window sills must be inspected for scratches, and the reliability of their fastening must be checked.
- Doors. They should open smoothly and hold their position. Door handles should be comfortable, hinges should not creak.
- Floor. Pay attention to the floor covering, scratches and abrasions. Check if the parquet or linoleum is swollen anywhere, and what condition the tiles in the bathroom are in.
- Lighting. Check that the lights are on in each room and carefully inspect the outlets.
- Ventilation. Inspect and test ventilation in the kitchen and bathroom. To do this, attach a sheet of paper to it: if it does not stick, the ventilation is not working well.
- Batteries. They must be tightly attached to the wall and have temperature regulators. If you are inspecting in winter, pay attention to how comfortable the temperature in the rooms is.
- Water. Open all the taps and check how the water flows, whether it is leaking, and whether the pressure is good. All connections must be tight. Flush the cistern and watch how it fills, drains and holds water.
Draw the owners' attention to any shortcomings and bargain.
Your goal is to convince them that renovations will require significant funds and the premises are not worth the amount requested.
Also draw the seller's attention to the shortcomings of the yard, entrance and area.
Little tricks: how to get a discount from an intractable seller?
Sometimes small tricks can help achieve this difficult goal - to reduce the price of housing for the principal owner.
You may come to the seller's viewing with a list of several other home options in hand. During the negotiations, it is as if to “stipulate” that there is a large choice of real estate, but you practically do not have time to travel to other objects for inspection and you will choose the cheapest one. It is clear that the interested owner will immediately begin to get nervous - I would like them to buy from him...
At this moment you say: “I am completely satisfied with your house, I would definitely take it if its cost was a little less…”. Considering the current competition among real estate sellers, be it an owner or a realtor, giving in to a real buyer in price is more profitable than “staying with one’s own.”
The second trick is that you need to ask neighbors or other residents nearby whether there are any shortcomings in the house you are interested in. As a rule, there will always be “well-wishers” who will tell the whole “bitter truth”. For example, old ladies or mothers on maternity leave. The owner of the house may also be present during the conversation, refuting or agreeing with what was said. If any “pitfall” pops up, it will become a good bargaining chip.
If you discover shortcomings that the owner of the house was silent about, feel free to demand a price reduction! But don't put too much pressure on the owner. Defensively, he may get off the hook and refuse to sell you the house on principle. Keep the conversation about the deal calm. And in response to the undeniable arguments you have given regarding the need to give you a discount, the seller will definitely agree!
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Buyer's mistakes when bargaining with the apartment seller
Representatives of real estate agencies are confident that bargaining is one of the most important stages when buying an apartment. In their practice, they encountered customer mistakes that prevented them from saving 100, 200 and even 500 thousand rubles.
Top 10 buyer mistakes during bargaining:
- Premature demand for a discount - by phone.
- Active bargaining after inspection of the first apartment.
- Demand to reduce the price with the words: “I don’t have any more money.”
- Indication of the shortcomings of housing in a rude manner.
- Demanding an exorbitant discount without inspecting the home.
- He talked about the features of the transaction - mortgage, notary.
- Demonstrating vulnerability. For example, a story about how the closest relatives live in this house.
- Statements with elements of comparison: “The apartment in the neighboring building is better and cheaper.”
- Pressure on the seller, demanding his decision immediately.
- No attempts to reduce the price.
Bargaining when buying an apartment on the secondary market is always appropriate. The buyer’s task is to thoroughly prepare for disputes, to behave calmly and at ease. Ideally, get acquainted with the current situation on the real estate market, look at competitors’ apartments in the neighborhood. Experts recommend preparing several template phrases and rehearsing a dialogue with the owner in front of the mirror. When justifying his position regarding the auction, the buyer can refer to the location, condition of the apartment, documents and the market situation. The ability to bargain is the key to success when buying an apartment, the opportunity to save up to 500 thousand rubles.
