Helpful tips for when writing up an offer

There are a few areas to consider, but with any negotiation it isn’t just limited to the items discussed:

Settlement Date: Motivated sellers generally like a quick settlement, Home Sellers to Home Buyers like a settlement date that coincidence with the settlement of the property they plan to buy. Also, rent backs are quite attractive to some Sellers.

Finance Terms: Cash is the strongest, but if you play your cards right finance can be competitive too. We coordinate 5-10 business day finance terms with our brokers. Have a per-approval letter to show to the Selling Agent, but be sure to white out the max budget and do it in a way that doesn’t suggest a max price was even there.

Special Conditions: Be sure to have contract conditions which protect you. I never recommend using the Selling Agent’s clauses as they are there to protect the Seller. Speak to a solicitor and have a good working order and or building inspections clause written up.

Acceptance:Always have a reason that you need a quick answer. For example, you could be looking at another property so you need a quick answer on this or some Buyers have work commitments to head back up North. This way the Selling Agent knows there is a deadline and reduces the chances your offer could be shopped around.

Price: Never start on a whole number (i.e.$400,000) this too a Seller just looks like an initial offer. I would always recommend odd numbers ($397,235). The other item is to increase in decreasing increments so first counter may increase by $9537, next is 6,221 and final is $3648. This looks like you’re closing a gap to your max budget.

Psychology: He who cares least wins negotiations. So be sure to have plenty of options and a plan B to fall on. The other tip is if you have a spouse, parent or a partner and there is a single person signing the offer. You can play them up as the bad guy and deflect any negative sentiment or price increases on them.

I agree with Kent, especially the Psych part. I don’t really buy on feelings anyway, even on my PPOR. For my current place I openly told REA’s that I had multiple offers in for other properties and the first accepted offer wins. This worked perfectly for me, because two offers were in to different REAs at the same agency. So they found out that I wasn’t joking, and actively competed with each other for the sale! Worked in my favour.

Quick sales are also important, such as not needing to sell your current place.

PS. I almost always try and get additional things in the sale for my PPOR for free. If the couch / fridge / etc look really good with the house, then I ask for them. In my current place I got the bar fridge and all the entertainment centre, TV, amplifier, speakers etc.