How to haggle when buying a property
Three in 10 homeowners didn’t negotiate at all on the price of their current home, missing out on huge potential savings because of their fear of negotiation, according to Barclays.
In fact, the mortgage lender found that Brits are more likely to negotiate on the cost of a used car than on the more expensive price of their new home.
Over one in five Brits (22 per cent) admit they just don’t know how to negotiate, while 17% are scared of losing the property if they try to haggle.
One in 10 just want to get the buying process over and 8% are too embarrassed to haggle.
Younger homeowners (aged 25 to 34) are prone to experiencing the most anxiety or stress when negotiating, compared to those aged 65+ who are much more comfortable with the process.
Rob Smith, head of behavioural finance at Barclays said: “Buying your first home is a particularly emotionally laden experience, and combined with having no prior experience of the process, its unsurprising that younger homeowners find it tough. However, if your aim is paying the lowest price possible then there are a couple of top tips which could help you along the way.”
How to haggle
Do your research – Never enter a negotiation without having done extensive research. Check out the surrounding area and what the houses are like, look at the local schools, shops and facilities, and crime rate. Don’t forget to check how long the property has been on the market, and if the price has been reduced already. You should come armed with the information, as well as questions or issues you want to raise.
Know your competition – It’s worth checking if there is anyone else also offering for the property – as this will affect the dynamics between buyer and seller. You can always increase an offer that was too low if there are no other bids – but not if someone else’s bid gets accepted. One useful tip is to try and understand the mind set and emotions of the seller, perhaps they are keen to sell or they have already reduced the price.
Know your end goal but also be realistic – It’s important to have in your mind exactly what you want out of your property, and your financial limits. Estate agents may show you properties outside of your price point, but take a step back and make sure it’s really what you want – and can afford – before you start haggling.
Find the communication style suitable for you – Some find face-to-face meetings easier, in order to get a feel and understanding of the person you’re negotiating with. In the current climate, this is less easy to arrange and many don’t want to meet in person. However, not meeting face-to-face may also help you disconnect emotionally from the seller and it reduces feelings of confrontation, which most people shy away from. But whether you meet face-to-face or via the phone, it’s crucial to always follow up in writing after any conversation you have, as keeping a paper trail will help leverage any potential fallbacks.
Be patient and use time to your advantage – Buying a home is an important process, and for many it’s the most expensive purchase they’ll ever make. So, let yourself take the time you need to feel happy with your offer; you don’t want to feel pressured to make an offer or ultimately regret anything, and no matter how much you love this one, you will find another you love even more.