Before buying a house or a condo in London, Ontario, the one single element that will determine how well you & your real estate representative negotiate your offer is:
How MOTIVATED Is the Seller And How MOTIVATED Are YOU
Has the house been on the market for over a month? Is it because the seller is not motivated enough to sell. Or perhaps by now, the house hasn’t sold and he/she is very motivated. Or, they are fishing for a price, or; (in most cases) by the time they pay off their mortgage and other debts, there is no money left at a reduced price!
And if you’ve been transferred, have your home listed, and you wish to downsize, or another child on the way and your house are too small, or your neighbourhood is a proctological pain, or you’ve had it with your landlord, you may be very motivated to buy!
Nevertheless, here’s a tip you must bring to any real estate transaction:
Avoid Emotional Attachment for the Home You’re Considering
If your heart is racing about the home, if you can’t hold back your emotions when thinking about the house, then you’re not going to do well when negotiating the purchase price. In some cases, money may not be the issue; it could be the layout, neighbourhood or perceived lifestyle.
What’s the single best piece of information you can have?
Besides my phone number, it’s the comparable sales and market data for the entire market and the area, plus the assessed values for five houses on each side of the house and ten across the street from the home you are interested in. Ask your Realtor to print out these for you to view. Now, here’s why:
5 Musts Before Making an Offer on a House in London, Ontario
1. Take a look at the currently active (for sale) listings in the area. Was the house you’re considering priced within reason to other homes? If so, you know you’re at a reasonable starting point.
2. Now, take a look at the average selling price compared to the listing price. You may notice that most houses in London are selling for the asking price or about 1-3% less than their offer price. If that’s the case, you know the original offers were LESS than this amount. Take this into consideration when making your offer.
3. Now, make sure you visit several of the other listings in the area. How does your choice compare to the others on the market? Is the home you’re considering in a similar shape? Is it better sited? Is it bigger, smaller, better style, better landscaping, etc.? These factors will help you determine how much you should pay for your home vs. how much others paid for similar homes in the neighbourhood.
4. Now, take a look at the average market times for listings in the area. If they’re long (evaluated on the market by market basis), the market may be soft, and you might have a more negotiating room with your offer.
5. What is the percentage difference from assessed values to market price? (I have an excellent formula for this and have found over the years to be right on the money!)
You’re now ready to make your offer.
This is where strategies come into play and are one of the essential steps in the buying process. Most buyers either overpay not get the home they want because of poor negotiating ( see my ten real estate negotiating musts) and upset; everyone or lose lots of sleep!