I won’t show you a house until we have a pre-house-hunt “sit down.” At The Kathy Chiero Group we call it a “Buyer Orientation meeting” and we insist that you take an hour of your time to get informed before we start looking at homes. We often go a step further and ask you to invite all of the “influencers” in your home purchase decision: parents, Aunts, Uncles, or your Grandparent who is providing the down payment. Everyone is invited to attend this first meeting. Why? Because we want you to understand what a “seller’s market” really means. Unless you “live” in this market — you don’t know and won’t be prepared for the decisions you’ll have to make. Your parents might remember the “seller’s market” of the 1990s and respond with a “ho hum” — no big deal, you might not get much negotiation off the price, but it’s otherwise business as usual.
No, it’s not. Not even close. And if you’re not mentally, financially, or temperamentally prepared you are in for a frustrating ride.
Here is how I describe the current Seller’s market: You are sitting at a poker table. The Seller of the home you want sits across from you. Also at the table are 10 other poker players with varying stacks of chips who are competing against you to “win” the same home. How do you win? You put two hands around your chips and shove them all over to the Seller’s side. And, in doing so, you hope that the other ten players have fewer chips than you do because they are all doing the same thing. Bottom line: there is no negotiation. On anything. The offered price begins at list and goes up. The financing has to be strong, preferably cash with a letter from a known, local lender (See Ten Ways to Win #1) You waive your right to ask for repairs after the home inspection. In fact, while we don’t recommend it, some buyers will waive the home inspection completely. You must have extra cash to give the Seller over and above what the house appraised for (see Ten Ways to Win #7). You offer non-refundable earnest money. You close when the Seller wants to close. You give the Seller as much time as they need in the home after closing. At no charge. If you do ALL of these things — you are doing what most of your competitors around the table are doing. In other words, these (non) negotiables are just a start. What else can you do?
How can you put money in the Seller’s pocket in creative, non-traditional ways? This is where a good Buyer’s Agent can help you. Your Buyer’s Agent can make a phone call to the listing agent to find out what the Seller needs: is the home in need of clean out? Are you willing to do the clean out so that the Seller doesn’t have to? What are their moving plans? Can you contribute $500 to the rental of a truck for their move? Instead of raising the purchase price, can you contribute $1000 toward their closing costs, thus increasing their “net” at closing? These are the “extras” that often tilt a decision your way.
As you read this over you begin to see why it’s important to have all of your “influencers” on board because most of what this market requires runs completely contrary to traditional negotiating. That is because this market is NOT a traditional market. It is an historic market that we may not see again in our lifetime. To “win” in this market requires very non-traditional methods and a sharp Buyer’s Agent who knows how to negotiate: giving enough, but not outside your comfort level.
This blog is written by Kathy Chiero. Kathy is the Team Lead for The Kathy Chiero Group of Keller Williams Greater Columbus Realtors. Thinking of Buying or Selling? Find us www.OurOhioHome.com © 2021 All rights reserved.