How to Negotiate a Home Purchase in MN
Whether you are working with a Realtor, representing yourself, or having the listing agent represent both you and the seller we hope you will benefit from our Minnesota home buying and negotiating advice.
Find out as much as you can about the seller
Why is the seller selling? If you can determine why the seller is selling you can structure the terms of your offer to entice them. Our advice is that you play your cards as close to your chest as you can. One of the best ways to do this is to work with a Realtor that has a reputation for being a fierce negotiator.
Keep your intentions and emotions to yourself
Do not let the sellers or their agent know how much you like the house or why you are making an offer. As a listing agent representing the seller, we are trained to ask questions of the buyers and their agents to determine how to advise our sellers. If we know how badly the buyer wants to purchase the house or the reasons they want to purchase the house as sellers, we have the upper hand.
Have a backup house in mind
When a buyer has another house in mind it is much easier to be a tougher negotiator. If the sellers feel that this is the perfect house for you and that you will do anything you can to buy it, they have the upper hand. If the seller feels like you have another house that you will be just as happy with then you will have the upper hand. This is especially true if you actually do have a backup house in mind.
Take what the seller and the listing agent say with a grain of salt
Some sellers and agents are completely genuine in their marketing and sales techniques. Others will exaggerate, manipulate and use every sales trick they know. By law the seller's have to fill out a sellers disclosure and disclose any material facts they know of that would affect your use and enjoyment of the home. It is especially important to take this information with a grain of salt. Some sellers conveniently forget, and others actually do not notice or do not consider certain problems worthy of disclosing.
Hire the best inspector in town but know their availability first
Before determining how many days you will require in your inspection contingency you should know the availability of the inspector that you want to inspect the house. Some of the best home inspectors in the Twin Cities will be booked solid for up to 10 days.
Consider the motivation for the advice your real estate agent gives you
Unfortunately, there is a high percentage of real estate agents that put their own interests ahead of their clients. If a Realtor is desperate for a commission check, they can justify doing or saying just about anything. The advice a lot of Realtors give is carefully calculated to make their job as easy as possible. Some real estate agents will suggest that their buyers use certain inspectors that they know will work hard to "keep the deal together". Some real estate agents will suggest that buyers don't get a radon test or worse yet don't get an inspection at all. There are some real estate agents that get kickbacks or other incentives from the people they refer business to. If the agent pushes you to use a certain inspector, mortgage broker, title company or contractor, it is a red flag.
Call the Police
Before making an offer on a home, townhome, condo, or land in Minnesota it is wise to contact the local police department and ask them questions about the neighborhood.
Do a Comprehensive Market Analysis aka CMA aka Comparative Market Analysis
Ask your agent to provide you with an analysis of the home you are considering writing an offer on. It is best if you can be with your agent and have them show you how they are doing the analysis and how they are choosing the comparable properties to use for the analysis. This way the agent isn't tempted to manipulate the analysis to justify the advice they give or might be tempted to give.
Know the numbers
Discuss ALL of the numbers with your mortgage professional to make sure you know exactly how much the closing costs will be and exactly how much your monthly payments will be.
Get a second opinion from The Minnesota Property Group of RE/MAX Results
These are just a few of our tips, tricks, and snippets of advice when buying a home in the Twin Cities Metro Area of Minnesota. We are happy to help you analyze the market, the property, the offer and the strategies to help you put your best foot forward.
