FAQ #3 - Am I Going To Have To Negotiate?

I'm glad you asked that, because it gives me a chance to use my favorite economist response: "It depends."

We have set the asking price on your home. From our market analysis, based primarily on the recent sales of similar homes in your area, we have an excellent idea of what your home should sell for. But it takes two parties to make a contract, so we have to find a buyer who agrees with our opinion. There's an old saying in real estate - "the seller sets the price but the buyer determines the value".

So let's say that your price is a good one, in that it doesn't seem out of line and will attract buyer interest. One of three things is going to happen:

You're going to get an offer. This is good. But it's probably not going to be a full price offer, because everyone wants a deal. The buyer is probably going to come in low, and he's going to want you to negotiate, even if it's just a little bit. Our response will be based on how low he comes in, how many showings we're getting, how long it took us to get an offer, and what feedback we're getting from showing agents. In this situation, we're most likely going to recommend that you give a little. Maybe, if he was fairly close, that you meet him halfway. If he was significantly low, we might recommend a counter-offer at the bottom line price you'd be happy with. We'll see how it looks, but we will probably be negotiating. It has been our experience that refusing to budge on price in these situations is very often a deal-killer.

You're going to get more than one offer. This is excellent. You're still going to be negotiating, but you'll enjoy it, because, with our current market conditions, your asking price just became the lowest likely price, and we'll be looking a lot harder at making the other terms of the contract work well for you too.

You're not going to get an offer. This isn't good. And it's going to increase the likelihood that you'll be negotiating. Best case is that it's just going to take some time to find the right buyer, and that's not an unusual situation. But the longer it takes, the more most buyers will expect you to be flexible on price. The worst case is that you're going to have to negotiate with the market, i.e. you'll have to drop your price to attract sufficient interest to get an offer. And when the buyer shows up, he won't care that you just dropped your price - he's still going to offer less than that. That's one of the reasons we take such care with our initial price recommendation - we don't want you to be in that situation.

Negotiations take skill and an awareness of what's going on. But remember, our job is to make sure that when the deal is done, you're satisfied with your end of the transaction. And if we do it right, the buyer will be happy too, and we'll proceed to closing with everyone working toward the same goal.

Mary & Dick Greenberg Elevations Real Estate LLC 106 East Oak St. Fort Collins, CO 80524 970-689-4663 www.maryanddick.com