(NSW) Proper way to negotiate & seal the deal?

We're interested in 2 - 3 properties which fits our requirements and wanting to get some idea on how to seal the deal and not to let agent shop our offer.

Just to give an example: the property is priced 550k to 610k and will be sold via normal sale (not Auction).

After few research, we understand that similar unit around the area is sold on the price range of 585k to 620k mark.

We've always low ball-ed .. in this scenario, we will be offering 555, which 99% will be declined and start going up ... but is this really the right way of doing it?

Or if I really want the property, should I go straight to our maximum budget for the property? Say 600k and if it got declined .. then it got declined .. it's just not meant to be. But the dilemma with this is, what if it got accepted straight away? Any person would say 'danggggg .. perhaps I can get it at a cheaper rate' ..

But in saying that, how do I per say 'give that pressure' to the agent not to shop around with my offer? Normally, I would give them timeline and say my offer is only valid until end of the day today. Is this the appropriate and acceptable norm in RE world? If so, what would normally be the deadline? say if you offer the 600k on the Monday (after Saturday inspection), is it too much to ask for a reply by end of day Monday (the same day)? if accepted, the disclaimer is subject to due diligence.

Agent would sometimes reply back to the pressure by saying "we will be meeting the owner on Wednesday" ... hence what he's saying is, he can give us the reply only by Wednesday ... but is this normal? can't he just make the call on Monday to the owner and present our offer?

From this example, 600k offer for a unit with asking price of 550k to 610k and sold price on the similar unit of 585k to 620k ... i think 600k is a genuine and serious offer.

 

Then make $600k your final offer. if you really want it then why muck around? If offer is not accepted, move on to the next one.

 

I do my research and make my first offer close to or at what I want to pay for myself or a client, within 5-10k. I prefer to negotiate on terms rather than price where possible eg settlement time.

Unless its obvious that a lowball would be considered, I dont waste my or agents time. As a BA, cultivating agent relationships is vital. If you become known as a low baller, they wont want to do after hours or private inspections and tell you to wait till the open home... whereas a lot of my deals are done off market or prior to first open.

 

Or put a deadline to your offer. of course if it's an offer they won't accept in the first place, the deadline has little effect. They are to sell to the highest offerer so like @DaveM said, apart from price what else puts you ahead of other buyers?

 

If it's a good enough property pay what it's worth I've let too many good investments go by trying to get it BMV when it still would have been worthwhile at market value. Apart from that @DaveM has hit the nail on head. Work on terms that suit the vendor do they want short, long term settlement, no finance clause(of course make sure you have pre approval)? Give them the options they want. Always a good idea to show/tell the agent why you are making the offer at that price give them 48hours to decide as you have other properties you are "interested" in. Good luck with it.

 

If you try pulling that stunt in Sydney atm, you'll get nowhere. A low ball offer, a deadline, and then a "subject to clause" - any REA worth his salt would show you the door.

Then find out from the agent the sales process they have in place for this property & vendor (which can change vendor to vendor and agent to agent). Then make the offer on Wednesday once you have found out what the other offers are and where you need to be to be competitive on price as well as T&C's as others have said.

 

As others have said, start with what you consider to be a fair price and offer that. Unless the market is very soft and you think you might be able to get a bargain, but you indicate you expect the offer to be rejected 99% of the time, so that is unlikely. The also agent may not consider you to be a serious buyer if you are putting in low ball offers and if they have other potential buyers they may not contact you again to renegotiate.
As an example - I've missed out on a property by $5K previously and wasn't given the opportunity to increase my price; the vendor was happy with the highest bid and just took it.

A way to counter the above is to tell the agent that you are putting in offers on multiple properties and that you will take the first offer that is accepted.

 

If this is in NSW? If you really want the property, I wouldn't be worrying about putting a time dead line on it because it means nothing. Put your best offer in,tell them you will exchange with a cooling off and finance clause. That way no one else can offer higher, the only thing you will be liable for if you pull at at this stage is a 0.25% of the purchase price.

 

With my recent properties on the market. Agent presented the offers (multiple offers) but I wouldn't accept anything I felt was too low. Once I have offer/s at a price I'm happy with then I'm happy to proceed.

If the vendor is desperate and there's no other offers then low balling can work.
Otherwise it's not going to get you a deal.

 

I agree with Tony if you want to low ball ,have something else to offer, it may be terms that may suit the seller it may be a short settlement and an unconditional offer. If they don't accept your terms then put in an offer near your best price and possibly terms that are more in your favour

 

Do say that you have 2-3 properties you are interested in buying and tell the agent you'll only commit buy the first offer that's accepted. Wont work in a hot market but will work in a dead/cold/not overly strong market.

 

I think you will be closed out if you try silly price and demand an answer to low offer.

Why would they look at you if most places sell after first open or so if priced right ?

Your offer not likely only one either.....so you prob have real competition.....

 

Negotiating strategy is almost totally dependant on the market conditions you are buying into at the time . Bring a strategy to the wrong market conditions and you'll leave empty handed, eventually likely to pay more depending on how long it'll take you to change strategy .

My 2 cents.