How to Negotiate House Price | Tips for Sellers
Negotiating house prices can be the most difficult part of selling a property. Can you do it, should you do it, and what’s the best approach? It’s natural that you want to negotiate the best possible price for your house, but how do you go about it? That’s the purpose of this guide, which looks at how to negotiate your house price when selling your home.
How can I negotiate a house price with a buyer?
Most negotiations between vendors and buyers go through the estate agent unless you sell your home with an online agent.
Your estate agent works with your best interests in mind, and their aim is to get the best possible deal for you. That doesn’t always mean the highest price, however. Many other factors come into play in the wider market, such as market conditions and demand, but also what else does a buyer offer you based on your circumstances, for example, can they move quickly, are they a cash buyer. All of these factors come into play and your agent should ascertain all of this for you.
You’re not obliged to respond immediately to offers received on your home and any offer that you’re not happy with you might ask your agent to reject without going back with a counter offer.
With every negotiation tactic to sell your home, remember that your estate agent has experienced salespeople, and negotiating is what they do and they are not emotionally attached to the property as you might be. Let them lead on this and use their skills to negotiate the best possible price for your house.
It’s generally easier to negotiate a higher price when demand is high and it’s a sellers’ market. More people will make an offer, meaning you have more of a choice over who is the most suitable buyer based on what you need from the sale of your home.
How can I get the highest price for my house?
If getting the highest price for your house is your main objective then even if the market isn’t at its peak, there are some actions you can take to increase the chances of receiving a higher offer for your house. With your agent, consider the following to negotiate the best price for your house:
Do your research
Familiarise yourself with your local market and prices of comparable properties recently sold in the area. Your agent will be a great source of information here this and this will help you determine if you are receiving a realistic offer based on your asking price and a good basis for your negotiations.
Get your property sale ready, not market ready
Having already gathered your guarantees for replacement windows, building safety certificates, records of boiler servicing etc at the start of the process, will mean that the whole transaction progresses more quickly. If your buyer can see that you’re serious and prepared for the sale, your agent will be able to utilise that as a benefit in the negotiation.
Be flexible
Be open to negotiating the price and be willing to make compromises (that doesn’t mean not getting a higher offer, but there should be realistic expectations). Doing so helps to build trust with the buyer and increases the chances of a successful sale.
Communicate clearly
Clearly communicate your expectations and be transparent about the reasons for your asking price. While your agent will handle the majority of your negotiations ensure that you are available to them to discuss options and answer any further questions they may have.
Consider the buyer’s perspective
Choosing a buyer for your home means understanding their motivations and priorities too. For example, if they are in a hurry to move, they may be willing to pay a higher price for a quicker sale. Discuss all different options with your agent who will advise you at every step.
Notify buyers of other interest
If there are multiple offers for your property, you can expect to negotiate a higher price. Your agent can notify people viewing your home, letting them know there’s a lot of interest and you could generate more offers based on this demand.
Consider a sealed bid
Should interest be high, you could consider a sealed bid offer on your home. This is when you invite multiple offers from prospective buyers. They submit their highest offer in a sealed envelope, which is then opened and compared by the you and your agent at a designated time to determine the winning bid.
Sell outside of a chain
Being in a property chain can be frustrating and impede the moving process. One option to overcome this is to either opt to buy your next property after you’ve sold (rather than while you’re selling) or consider moving into a rental home until the sale is complete. Removing yourself from a chain and becoming a chain free homebuyer yourself, could make you a more attractive seller and may attract asking price offers on your home.
However, always weigh up any cost implications of this.
Add enticing extras
Discuss with your agent the advantage of potentially including items such as the current furniture in the sale as this can attract improved offers. Offering white goods like kitchen appliances could be particularly appealing for first-time buyers. This not only eliminates the stress of moving these items, but also provides the opportunity for upgrading your furniture.
Stay on top of repairs
Ensure you’ve updated all maintenance work on your property before putting it up for sale, whether it’s that leaky tap or giving the walls a fresh coat of paint. Make first impressions count by making your home look appealing, increasing the chances of selling for the price you want (or more).
Take the house off the market
You can attempt to increase a buyer’s offer that is close but not exactly at your desired selling price by declaring the price at which you will take the property off the market.
This might appeal to a buyer as it minimises the risk of being outbid by another party. However, you’ll need to honour the agreement and remove the property from sale, or risk losing the buyer. Discuss this tactic with your agent as they will be able to gauge if this is something that would entice the buyer.
Be prepared to walk away
It’s important to have a clear idea of your minimum acceptable price and be prepared to walk away from the negotiation if the buyer is unwilling to meet your expectations.
Will the buyer negotiate the house price after the survey?
Buyers conduct a survey on the property once a price has been agreed upon to ensure everything is in good order. If anything comes back from the survey undervaluing the property, they may return to the negotiation table and try to lower the price – known as gazundering.
At this stage, there’s a decision to be made. Depending on the survey results and taken advice from your agent, you may agree to a lower price. You can hold firm if you disagree with the results, believing they aren’t a guarantee of future issues. Although, this approach could hinder your sale.
The outcome of a negotiation after any survey will depend on specific circumstances relating to the sale and the needs and priorities of both the buyer and the seller. By maintaining open communication and being flexible and transparent, you can increase the chances of a successful outcome.
What role do estate agents play in negotiating house prices?
Your estate agent acts as the mediator between yourself and the buyer. Their aim is to get the best deal for their client (the seller) based on market conditions and personal circumstances.
A good estate agent is communicative and keeps you in the loop, advising on the right type of offers. This doesn’t mean you need to sell if the agent thinks you should. Essentially, it comes down to whether or not you’re happy with what’s offered.
Will using more than one agent achieve a higher house price?
While it might sound like using more than one agent could increase the chance of achieving a higher price for your home, the reality may be different. Having multiple agents could boost the property’s visibility and reach a wider pool of potential buyers, but it can also create confusion and competition between the agents, which may negatively impact the sale process.
There are pros and cons of using multiple estate agents. The property will have more visibility across portals and in agent shop windows, but it can also look like you’re more desperate to sell your home.
It only makes sense to have more than one agent if you want to drum up national interest as well as local interest. Otherwise, most vendors stick to one agent when selling their property.
What if I change agents?
Of course, there may be the issue of an underperforming agent or you feel they’re not acting in your interest to get the best price. You may decide to try another estate agent, but how easily can you change? Typically, agents work under a contract with the vendor, and the terms of that contract dictate the process for terminating the agreement.
If the contract has a specific term, you’ll likely need to wait until it expires before changing agents. If, however, the contract is open-ended, then it’s possible you can terminate the agreement with written notice. Therefore, it’s necessary to read the terms of the contract before signing anything with an estate agent.
Pros and cons of changing estate agents
Pros:
- Improved service. Sometimes it’s just not a good fit with an agent, and a new one may be better equipped to handle your specific needs. Perhaps they provide a more personalised and efficient service.
- Increased visibility. A change in estate agents may lead to a renewed focus on marketing and promoting the property, increasing its visibility to potential buyers.
- Better fit. Using a different estate agent can provide a new approach or additional resources, making them a better fit for your house-selling needs.
Cons:
- Cost. There may be costs associated with changing estate agents, such as termination fees or already-used new marketing materials.
- Time delay. Changing estate agents could delay the sales process, as the new agent may need time to become familiar with the property and implement their marketing strategies.
- Property reputation. If the home has been on the market for a long time, switching estate agents may raise red flags with potential buyers and harm the property’s reputation.
How many estate agent valuations should I get?
In an ideal world, you won’t need to change estate agents because you instruct the best one at the first attempt. One of the best ways to feel confident about instructing the right agent is to get several valuations. Aim for around three before deciding on which agent to instruct.
Multiple valuations provide a more accurate estimate of the value of your property and help you make an informed decision about the highest realistic price. Each estate agent may have a different approach to valuing a property and consider various factors. For instance, one might place a higher value on the property’s location, while another focuses on the home’s condition.
When getting valuations, it’s also good to select estate agents with experience in your local area who have a good track record of selling similar properties. If one valuation is significantly different from the other, you’ll have a good indication of a realistic property value.
Can I negotiate the suggested house price with estate agents before instructing?
Absolutely. Estate agents suggest a sales price based on their knowledge of the local property market, the current economic conditions and the level of demand. They are the experts, so you should consider their suggested house price carefully.
But you can tell them if you feel they’ve undervalued the home. Ultimately, you’re the one who agrees to the listing price. If you’re unhappy with the estate agent’s recommendation, you can suggest a price you’re more comfortable with. Just remember that setting an unrealistic sale price for your home will likely reduce interest and means the process takes longer.
Are estate agents fees negotiable?
Estate agents fees vary and are typically a percentage of the property’s sale price, this can be a motivating factor in negotiating the best price for the seller and it’s payable on completion. Some agents will be open to negotiation of their fee and others won’t. Bear in mind that agents offering a flat, upfront fee will be payable regardless of whether the property sells and what price it sells for.
On review of their terms of engagement you might want to negotiate the contract length if they act as sole agents. Most agents ask for exclusivity for at least six weeks, but it’s all negotiable.
Don’t be afraid to ask about the services included either. Find out precisely what their fee covers, including marketing efforts (how the agent will drum up interest in the home?), which property portals it will feature on and anything else they may offer as part of their service. But also be mindful that an agent isn’t just there to advertise your home for sale.
They play a pivotal role in your negotiation and holding your deal together throughout the conveyancing process and through to completion.
Finding the right house price
Ultimately, it comes down to you feeling comfortable about the price your home lists for and then accepting an offer in line with your valuation. Take your time when instructing an agent and don’t feel pressured into accepting any offer that doesn’t satisfy your valuation when the home is on the market.
If you need help finding the right estate agent, using a reputable agent from a professional organisation like Propertymark will mean you engage an agent who is not only qualified but regulated to a code of conduct.
Last Updated: September 22nd, 2024
