Expert tips on negotiating with real estate agents

When negotiating to buy a property, there are some things you can use to boost your chances of success and some that are best avoided.

What the buyer says

Nancy Hibbs, who works in the finance sector in Sydney, recently bought her first family home in the Inner West.

She says it can be intimidating to negotiate to buy a property, particularly if you aren’t familiar with the process involved. So negotiating with confidence requires you to be knowledgeable on both the buying process and the local market conditions.

“A lot of subjects and terminology in the process may be new to you, but if you spend a bit of time in the market, you pick up a lot of tips and tricks to understand the market and negotiating better,” she says.

“[For example] if you waive the cooling-off period, it will show the vendor that you are serious to buy. Also, get your finance ready. When you’re negotiating, those two things are your secret weapons to use to close the deal.”

The selling agent’s perspective

Agent John Priddy, of Ray White Hunters Hill in Sydney, suggests that the key thing for buyers to remember when negotiating for a property is that agents are people too.

“No one wants to have aggression and confrontation in their life, whether that be an agent, buyer, vendor or person on the street,” he says. “It doesn’t help you – it just makes life more difficult for everyone.

“My advice is always be upfront with the agent selling the property. Say things like ‘I would like to buy the property’, ‘I’ve been looking for the best part of… months’, ‘I have my finance ready’, ‘My deposit is ready to go’, ‘I’m happy to pay the full deposit as soon as we have an offer accepted’. Any buyer that uses that sort of approach will almost always go to the front of the queue.”

Tips from a professional

Of course, no one is more accustomed to negotiating with estate agents than a buyer’s agent.

Jacque Parker, president of the Real Estate Buyers Agents Association of Australia (REBAA) and director of House Search Australia, has these tips for property buyers:

1. Be prepared and market-knowledge savvy: There are many buyers who actively search before being pre-approved for finance, having/engaging a conveyancer/solicitor and conducting sufficient due diligence on the current market and likely comparable sales. It is crucial that you are ‘game ready’.
2. Assess the seller’s position: Provide the vendor with more reason to select you as a preferred purchaser. It’s not always simply the highest price that a vendor will accept, but sometimes more favourable terms can make a difference: settlement periods, deposit amounts (and capacity to release) and existing tenancy situations.
3. Know the method of sale: Most buyers wrongly assume that all vendors and selling agents ‘sell’ in similar ways, however this can backfire if you don’t find out exactly how the property is going to be sold.
4. Almost everything is negotiable: Negotiating is about giving and taking, often on both sides of the transaction, so don’t be afraid to seek changes here that suit. If you don’t ask, you’ll never know. Having a great conveyancer/solicitor on side here can also assist if you’re not using a buyer’s agent to purchase.
5. Be willing to walk away: If you’ve done all your homework, presented your best offer and weren’t successful, don’t be afraid to walk away confidently. If you are a realistic buyer in any market, you will eventually have success. Walking away may be hard, but paying too much over market value is foolhardy.

If you aren’t a confident negotiator, consider enlisting the help of a professional.

“Like selling agents, buyer’s agents are skilled negotiators,” Parker says. “Having a trusted and experienced advocate doing all the groundwork certainly makes the buying process easier, more enjoyable and often with a superior outcome.”

Buying a property is the biggest purchase most people make in their lives, so getting the right deal for the right property plays a big part in your financial future. Put your best foot forward in negotiations and you should soon be getting the keys to your new property.