The Market at the Moment
Besides checking comparables and working the numbers, it is important you gauge the state of the market in your area at the time you want to buy. For example, if it is a hot sellers' market, where properties are moving quickly, and the home you want is a desirable one with potentially wide market appeal, start your negotiations fairly close to market value. You do not want to lose the property playing games over price.
In some situations, a house or a location is so hot that simultaneous offers are made. Sometimes, the best of these is accepted with no negotiating. More often, the sellers negotiate with all prospective buyers simultaneously. They are out for the kill. If you truly want that property in such a situation, the following are some tactics that will help:
Offer your best price, but be willing to move up another $500 or $1,000. Do not, however, get caught up in auction fever and bid the house up above its market value.
Ask for as few extras in the sale as possible.
Make the closing date as agreeable to the sellers as you can.
Have loan approval from a mortgage lender.
On the other hand, if the market is soft where you are looking (sometimes called a buyers' market), if the seller is under need-to-sell stress, or if the house is not particularly appealing to most people, you can move more slowly and negotiate over a wider range. In these situations, it is possible to get a much better deal with a bit of patience and perseverance.
