When most home buyers think about making an offer on a home, naturally, the purchase price of the home is top-of-mind when we talk about negotiating.
Did you know that there are other ways to bargain with a home seller other than on price? The purchase agreement is full of opportunities to haggle over. Let’s take a look at five of them we deal with most often.
Negotiating home repairs is something I am quite familiar with. After the home inspection, when the homebuyer receives the inspector’s report, negotiations begin anew!
Understand, however, that no home is perfect; even newly-constructed homes can have problems. Don’t sweat the small stuff – save the negotiations for anything major that needs repair or replacement.
This is especially true if the problems are in one or more of the home’s major systems, such as HVAC, electrical, plumbing or with the roof or foundation.
We can negotiate for a price reduction, closing costs credit or for the repair work to be performed by the seller before closing. In some situations the first two options (price reduction or credit towards closing costs) are preferable, as they won’t typically delay the closing.
Recently I had a situation where during the inspection the home’s upstairs air conditioner did not function correctly. The next day, still within due diligence, I got an HVAC contractor to come out and evaluate further. The 23 year old system had issues.
We successfully negotiated not only a new air conditioner, but also a new furnace as well! The new unit was actually installed before due diligence was completed, thanks to a 3 day extension on due diligence, and my buyer clients are quite happy in their purchase! The picked up a new HVAC for the home and the seller also agreed to an additional $1000 in seller paid closing costs in lieu of other repairs.
With a mortgage comes a requirement to pay a down payment and closing costs. The latter includes all the costs of obtaining the loan, such as lender fees, notary fees and more.
While sellers are under no obligation to do so, many buyers negotiate with the seller to pay all or part of their closing costs.
It’s an easier pill for the seller to swallow if your offer includes a purchase price that’s fair and reasonable. Not a “low-ball” offer.
Anything that isn’t permanently affixed to the home or land (real property) is considered the personal property of the homeowner. Personal property that we commonly negotiate over for our homebuying clients include:
- Appliances, such as refrigerator, washer, dryer
- Window coverings, i.e. drapes
- Chandeliers not included with sale (refer to the seller’s disclosure)
- Portable out-buildings
I’ve seen home buyers, however, negotiate furniture, pool tables, artwork and more!
The closing date – the day on which the home becomes yours – is negotiable. This is important to know for several reasons:
- If you are trying to time the closing of your current home to be simultaneous with the new home’s closing.
- You need more time to find another home
- You are relocating and need to be in your new city by a certain date
If your schedule doesn’t conflict with the seller’s this is often a successful negotiation.
I find that most people have a love-hate relationship with home warranties. Some consider them useless while others love them for the peace-of-mind they offer.
If a home warranty is something that you desire, it’s possible to ask the seller to provide you with one – at least for the first year of home ownership. Another option is a termite bond or warranty. Depending on where you live, the termite bond might come in handy! Ask your agent about them.
Regarding home warranties, basic coverage varies by region and company, but commonly includes coverage for:
- HVAC systems
- Kitchen appliances
While the above is only a partial list of commonly negotiated items in a home purchase, it outlines the ones we see most often.
Feel free to reach out if you have questions on this or any aspect of the home purchase process. Would be my our pleasure to be of service!