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Negotiating if you already happy with the property

Discussion in 'The Buying & Selling Process' started by Katarina_Investor, 4th Apr, 2016.

  1. Katarina_Investor

    Katarina_Investor Member

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    Location:
    sydney
    Hi, we've found an investment property that matches most of our criteria - large block of land, brick house and a huge potential to add value as it is completely trashed inside. Consequently the price is lower then its alternatives.

    Given that we are quite happy with it, does it make sense to negotiate further? We don't want to let this property go, even for what it is currently advertised, however if we can save 5-10K on the sale, we will not complain either.

    Thanks
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    Location:
    Adelaide, SA
    Sure, if you can get it for less then that's a good benefit to you.

    In the scheme of things though, 5-10k isn't going to make or break any investment. I'd rather have the property than go back to searching.
     
    neK likes this.
  3. Nick Valsamis

    Nick Valsamis Well-Known Member

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    It is hard to predict how it will play out as there are many variables such as:

    - Which state the property is in.
    - If the property is in a desirable location.
    - If there much interest for the property.
    - If it been on the market for a long time.
    - If there been any price reductions.
    - If the agent has indicated that the owners are desperate to sell.

    The more you know, the better chance you have of a successful negotiation. Even then, there are so many ways that it can play out as each agent will respond differently.

    But generally without having much information and less risk of losing the property, then anything from the asking price and up is the best option.
    You can always talk about a lower price and feel the agents response and start from there as well.
     
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  4. Marg4000

    Marg4000 Well-Known Member

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    The longer you negotiate the more room you leave for someone else to snap it up ahead of you.

    If happy with the deal I would sign as soon as possible.
    Marg
     
  5. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Canberra and Sydney
    Agree 100%

    See so many deals fall over because the buyer expects some sort of discount - when in reality, they're paying a good/reasonable price for the property.

    Cheers

    Jamie
     
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  6. Magnet

    Magnet Well-Known Member

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    We had the same situation with a property we have had a offer accepted on. We were willing to pay another 3K and the numbers still worked up to top asking of their range. We didn't negotiate too hard but thought it was a good opportunity to practice. Negotiating is not a strong point for either of us. Every negotiating opportunity gives you some new insight and prepares you for the next purchase.
     
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  7. TMNT

    TMNT Well-Known Member

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    the longer or harder you negotiate, the more chance someone else will come along and snap it up and then you will be kicking yourself

    unless its a cold market that you are the only 'genius/idiot' looking to buy in the area
     
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  8. Michael_X

    Michael_X Mortgage Broker Business Member

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    Location:
    Gold Coast/Sydney
    Play this scenario through your head. Imagine you've placed your final & best offer and the agent gives you a call....he says

    'Sorry, unfortunately you missed out to a higher offer'

    What is your initial reaction? Is it:

    1. Great, I wouldn't have paid that crazy price, good on them for getting what they want.

    2. Dammit! I would have happily paid that.

    If it's Option 1, then stick to what you currently offered or even offer lower. If it's Option 2, then you should have offered more.

    From what you are saying, it sounds like just give them the $5-10,000 and get it wrapped up.

    Cheers,
    Michael
     
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  9. jins13

    jins13 Well-Known Member

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    Sydney
    Everyone is different in their approach, but for me when I do see a property I like, I offer the asking price straight away. My approach is to hold onto the property in the long run and I am confident that the property has potential to experience capital growth. I know that some of the properties that I have purchased, there wasn't much separating between myself and the other offers but the other parties were so confident that they were able to acquire the property at their price.

    I have the belief that the real estate agent/ vendor may have won the battle, but I will win the war at the end!