The Alewife

Decoding the Deal

Getting the price you want to pay

by Paul Martinez                              

One of the most uncomfortable parts of a real estate transaction for many people buying or selling a home is the negotiation that goes on once an offer is submitted.

Many times a buyer client will express hesitancy to “go too low” or not want to engage in the back-and-forth of making a deal.  This is normal, and our society tends to frown on negotiating or haggling on price.

However, knowing the how’s and why’s of negotiating a real estate deal can literally save you thousands of dollars, and is by far the most important part of a real estate transaction.

If you’re a little queasy at the thought of wrangling a new washer from the owner of the home you’re buying, or you’re afraid to ask for your closing costs to be paid, this article is for you.
First—map out your negotiation strategy!  Too many times I see people rush into a negotiation without having a clear idea of their goals.

After you’ve defined that, you need to work backwards and map out a negotiation strategy to help you get there.  This is the single most important step in this process, so please don’t skip it—spend a good amount of time on this and write it out!  If you’re working with a good buyer agent, they should be able to walk you through this step.

Second—you must understand what it is the other side wants.  Many times it is not money that is motivating a seller; they may need to move quickly due to a job transfer, or they may have so much equity in the house that they are just looking for a painless, straightforward sale over everything else.

Now, asking their agent will not usually yield much information—seller’s agents should not be disclosing any information that could put their client at a disadvantage.  That said, there are plenty of resources out there for you or your agent to get information from.

Decoding the Deal by Paul Martinez

Buy your home smartly

Making the decision to sell your home yourself is not an easy one. It may seem a bit overwhelming at first, but with the right information it is certainly possible--no matter what the real estate market in your area is doing.

The single most important factor in successfully selling your home without an agent is making sure your home is priced correctly.

No amount of marketing will get a buyer to pay more than your home is really worth. With the advent of online access to public information, homebuyers can research everything from recent home sales to area pricing trends to the sale history of YOUR home--all in a few minutes.

Today’s homebuyer is usually very educated about the market and the process of buying, so pricing your home above what the market will bear simply won’t work.

There are a lot of great tools out there to help you get a handle on home values; www.CambridgeHouseValues.com is an excellent one—plus, it’s free and doesn’t obligate you to anything.

Decoding the Deal by Paul Martinez

What you need to do

[Paul Martinez is a real estate consultant at RE/Max Destiny in Cambridge. His Web site CambridgeHomeSales.com offers free real estate information, advice and special reports to buyers and sellers.]

It seems like every week we hear something new—and usually negative—about the real estate market in and around Boston. Sales are down. Inventory is up. Prices are falling. However, not all the news is bad—in fact, I’d like to share a few strategies with you that will help you get the best results in this market.

Paul Martinez

It’s no secret that homes are sitting on the market longer.

Maybe you’ve even had your home listed with an agent and it hasn’t sold—a very frustrating experience. Buyers seem to be sitting on the sidelines, waiting to see if the market will shift again. Meanwhile, you’re left wondering what you can do to get your home sold and move on with your life.

Relax—things are not as bad as they seem! Yes, the market has slowed and prices have dropped from their peak last year. However, it’s important to put this in perspective—we have just come off the biggest run-up in real estate prices in history. In 2004-2005 alone, prices went up 10% or more in certain markets.

So, if you bought your home at least 2 or 3 years ago and have a decent amount of equity built up, you should still be able to sell your house and walk away with money in your pocket. Of course, if you were one of the lucky ones who bought 3 or more years ago, you should have plenty of cash sitting in your home—which means you can either rent the property and create a positive cash flow or sell it outright and pocket the difference.