Make an offer
So you’ve found the perfect home, you’ve done all of the inspections and reports, and everything is all good. It’s time to make an offer.
This can be a really stressful time for first home buyers. Think of all the effort that has got you to this point: you’ve spent hours and hours researching, hundreds of dollars, and visited possibly dozens of properties. How do you know if you’re making the right offer?
What happens if your bid is too low and your dream home gets scooped up by someone else for just a few thousand dollars more? Or what if you overbid and pay tens of thousands more than the owner was willing to accept?
I remember when I tried to learn how to negotiate my first home with a real estate agent. It was REALLY frustrating. Conflicting information. Confusing terms. And technique after technique that didn’t work.
Fast forward to today, and we have helped over 100 customers with techniques to negotiate 5-10% off their first home purchase price as well as arranged awesome home loans for them! I’m not saying this just to brag. It’s to show you what’s possible when you learn negotiation tactics from the right sources.
Speaking of, that’s what this chapter is all about. It’s a collection of hand-picked resources to help you master negotiation tactics and learn how to negotiate a house price with a real estate agent. I will show you how you can remove the stress from this process and confidently offer a fair price for your house.
Have confidence with your research and finances
When you start to negotiate the house price, you want to have complete confidence in your research, home loan and finances. Here’s what you should have as a minimum before you come to the negotiation table:
☑️A pre-approved home loan: you want to know the maximum amount you can afford before you start actively negotiating on price. If you’ve been following this guide step-by-step, you should already have a pre-approval. Even so, at this stage, it’s worth checking back in with your mortgage broker to confirm the specifics of your pre-approval and make sure it is still valid as we covered in Chapter 3.
☑️Know the property’s value: you can’t negotiate effectively without knowing how much the property is actually worth. If you’ve skipped this, go back to Chapter 5 and learn how to accurately value a property
☑️Get a Building & Pest Report moving (if you haven’t already): A building and pest report is what I would consider one of the non-negotiable aspects of buying a house. These report cost between $400-600 and have literally saved me over 5 times from buying complete lemons of properties. The building & pest report can take between 7-8 days to arrange and get back so its best to start looking for someone to help with this sooner rather than later. Head to Chapter 6 to learn more about building & pest reports if necessary.
In order to a have a complete picture of the property you’re buying, you should also check the potential rental income, similar property sales, flood reports, commute times, and research the suburb and surrounding areas. Chapters 5 and 6 cover this in more detail, so head back there if you’ve missed anything.