Quote from http://www.jenman.com
If you decide to make an offer for a home you like, be aware that the lower your offer the less chance you will have of buying the home. Often it is best to make one offer – your best offer. Make it in writing and state that you either can not or will not pay any more. Be careful playing the ‘bluffing’ game, it can easily backfire on you. Decide which is more important – the home you love or the price you will pay. You don’t have to pay more than you can afford, just don’t be too clever or else you may miss the chance to buy the home you love.
End QuoteIs this a fair piece of advice?? Wouldn’t you end up paying more than you need to in more cases than not??
Cheers
Wilko
no – not good advise for an investor. ok advise for a home hunter.
as an investor you should be trying everything w/in reason to get a bargain.
the most money is made at the pruchase. purchase under the market and you have made money.
the best tip to negotiating is never fall in love with the product – be prepared to let it go if it doesnt meet your price.
cheers
Hi there,
I agree with Aussierogue.
Jenmen is suggesting an emotional link with the house of choice.
Decide which is more important – the home you love or the price you will pay
Emotionally getting attatched to a house would have to be up there with the DONT’S of investment buying.
As Aussie stated, if your a HOME buyer, than you can make that decision, but it’s not really being too clever (as Jenmen suggests) to negotiate.
Just follow a plan [
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Cheerio
Sooshie []“small steps make the journey” (SAS)
just to clrify a little though[
]sometimes as an investor putting in your best offer first can be a good strategy.
especially if you think the market a whole is undervalued.
for example i dont think steve spent too much time negotiating when buying 25 properties in such a short time.
also if i find a +ve cashflow property showing me 30 pct return i wouldnt muck around.
cheers
i agree with the others
this is poor advise (i don’t think Jenson likes property investors)?
a favourite Investment quote of mine from Robert Kiyosaki (think there’s another post about him) is
“the profit is made when you buy not when you sell”
great advise, i wrote it on a piece of board to remind me of it. i always offer low bought a property for 50k (asking 59), but then i’ve missed out on some good deals because i was being too smart over a few thousand dollars. It’s all part of the game, anyway you can always go higher but you can’t go lower
westanDefinately not good advice even for home buyers.
When we bought our first PPOR we were willing to pay over $270k for it. We put in a bit of a silly offer that we never thought would be expected, but after only one round of negotiations we paid $20k less than what we thought was a fair value for the area. The agent obviously couldn’t be bothered negotiating further and pushed the sellers to take the offer. Made us very happy.
Even for your own home you shouldn’t just pay the highest price you are willing. There are always other nice properties that come about.
I think that this is the silliest advice I have ever heard!!!
For the owner/occupier or for the investor, there is no need what-so-ever to pay top dollar.
Generally when selling a home, the vendor will add a bit on to their expectations in order to play the game. By offering the full asking price you will most likely pay more than they really need to be happy to sell. By offering every dollar you can, you leave no room to move and may end up paying too much when the seller decides that they want to play the negotiation game.
I think it is important to remember that there are thousands of properties for sale, and hundreds coming on the market every day. The home you see will not be the last you will ever see. Even if you miss an excellent deal because you tried to negotiate a better price, there will be another along soon. If you had offered your very best price, would it really have been THAT good of a deal anyway.
Does anyone on the forum think that the advice is valid??? I’d be interested to hear your opinions, maybe I am just closed minded?
Regards,
VictoriaReason can answer questions,but imagination has to ask them. — Ralph Gerard
I agree Nats.
I think that it is a self serving piece of advise by Henman.
Fancy a man with multiple national agencies that are against auctions and only sell by negototion recommending that course of action.
rolls eyes
I have to agree with Jenman on that comment alone, if it relates to owner occupiers looking for a HOME and opposed to an investor looking for a HOUSE.
For those of you who know me – me agreeing with Jenamn does not happen that often… so sorry if I scared any of you…[8D]
PEte
…Beware of the dreamtakers…
Recently I just bought a townhouse through Jenman real estate, they list the asking price very high. But I only offer what I think it’s worth and was excepted.
I don’t agree with their advice even though if you are a home buyer not investor. Why on earth would you want to pay more if you can pay less.
Kind regards
Chandara
[Keep going, you’re nearly reach the end of financial freedom]g’day
some confusion i think
the advise never said pay top dollar.
it said sometime its best to put your ‘best offer’
on the table first.no comment about paying top dollar
there is a difference
here are some reasons you would put your best offer first
– market is undervalued and you want to buy quickly
– the home has a price on it that is cheap. ie if you try and negotiate, someone else might come in and buy it from underneath you
– at an auction. the knock out bid. valid tactic
– the home is perfect for you. ie you really cant afford not to buy it. so give them a good price.
for example a friend bought a home for a good price very quickly because it was situated next to his work. all the other places he looked for were 10km away. when you take into account transport and time etc it was worth his while to buy this property even if he had to pay a little more, just to make sure he got it.– if you look at other industries an best offer first up is used all the time. why do you think that footabll teams increase the contracts of some players even when those players have 1 year remaining on ther smaller contracts? its to make sure they get the deal done.
ps – ive been involved in over 500 negotiations so let me prattle on a little
happy negotiating
cheers
aussierogue – totally agree
…Beware of the dreamtakers…
tks willi
one last point
im always wary when advise is given in absolutes like ‘always’ or ‘never’
there is a time for everything (see westan yve got me quoting ecclesiastes)
[
]I reckon that if your buying anything and you can get it cheaper than the rrp or market value by negotiating a lower first bid then kudos to you! you would get more cg by buying a house for 5k under valuation price then selling it 5 years on for 30k more! i dont know if thats too basic to work ( although it is hopefully in the process of working for me! ) or whether i`m being naive but that waas my 2cents worth!
Number 1 rule in Negotiation is :Let the other side put their position first. From there you can frame the price. IE Always make very very low offers!!
How do you handle some R/E agents price range, eg. range from 220 to 260, sometimes they give a 50,000 range in difference!
I find it a bit of a turn off, it suggests that the agents have no idea about the price.
I am talking about your normal suburban property, that should easily be valued.R/Est agents are No.1 interested in their commission (What’s in it for me). The commission for them wont be much different if a property is sold 30T up or down etc. They will quote a higher figure to appease the vendor. It gets back to always offer BELOW their LOWEST price – wait for bites – DO NOT budge!!!!
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