10 December 2019
Negotiation – how does it work in residential property sales?
There are many ways to eat a Kiwifruit – and the same goes when selling your residential property.
Negotiation is the most common sales technique used nowadays to sell a residential property. If you’re about to place your property on the market, we’re here to help you understand how to optimise the sale of your house through this method.
The key to selling by negotiation
Commonly used when it’s difficult to estimate the market-price of the property, in this sales method a potential buyer makes an offer on your property, thus setting the starting point for negotiations. Usually a real estate salesperson will advise a price range, but the price isn’t set. Offers are set by what a potential buyer thinks the property is worth, and the current market conditions. With no closing date in a negotiation, the key to selling your home through this method is to keep negotiations moving.
What are the steppingstones?
When you meet with your real estate salesperson, they will advise you of the options available to you to sell your home. They will usually recommend selling by negotiation if you’re looking to ‘sell it quickly’. This method is straightforward for both the buyer and the seller:
- Set your price or price range
- Advertise your property and hold open homes
- Let buyers place offers
- Negotiate with your selected buyers
If you enter a multi-offer situation, where more than one buyer makes a written offer on your property, the seller can choose the between the offers – and their conditions – to select the one that works best for them.
Considerations when choosing negotiation as your sales method
Your real estate salesperson will help you identify what the best form of sale is suitable for your home. When you go to market, the key considerations that will impact your sales method include:
- The current state of the market – If it’s a sellers’ market (supply isn’t meeting demand), you may need to consider alternative sales tactics like going to auction or to tender. In a buyers’ market, it’s better to indicate the price range – like when using negotiation.
- Target market for your home – If you’re targeting first home buyers, they’re more likely to shy away from competitive situations like auctions.
- Your residential property’s price bracket – Offering a price bracket helps potential buyers understand the perceived value of the property.
There is no ‘one size fits all’ method when it comes to selling. To help you make an educated decision, speak to one of our real estate salespeople to gain insight into what is the best sales method for your home. We’re happy to help you understand the market and the nature of your property.