3 negotiating tips for homebuyers

Do your homework before signing on the dotted line.

Recently released figures reveal that homebuyers are paying more when purchasing their first homes. “The average purchase price amongst first time buyers continues to show a significant year-on-year increase of 12.8% to R650 574, from R576 675 a year earlier,” said bond originator ooba in a statement. But are you paying more than you should?

You should make a rule to haggle before you part with your hard-earned cash – not unless, of course, you’re buying groceries at the supermarket. Where it involves purchasing costly property such as cars and houses, it’s always acceptable to negotiate the asking price. Otherwise you stand to be fleeced by by cruel salesmen and estate agents.

Johannesburg-based estate agent Cheryl Moosa, a Principal at The Agency Real Estate (Roodepoort), gives us negotiating tips for homebuyers. These would especially come handy for first-time buyers as they're apparently spending more on a property than they did a year ago, according to a report by property financiers ooba.   

1. Find out what you can afford
The potential buyer should first approach their bank for a pre-approval to determine what they can afford. Once this is done, they will have a clear indication on what price range to look at and ensure that deposits are in place.

2. Compare similar properties
The buyer must look in property magazines and visit show houses in their area of choice so they can have an idea of prices in that particular area. This will give them an idea of what price to offer on the property and how much they can negotiate. It's important to know that knowledge is power when negotiating.

3. Use your bargaining power
It's always good to know who is favoured by the market as we'd be either in a buyers' or a sellers' market. Understanding this would allow you to negotiate accordingly. It's also advisable to see how many properties are being auctioned in your area of choice, as this would have a high impact on the price. A lot of purchasers are opting to go this route due to the high volume of foreclosures of properties and the low prices they can be picked up for.

To contact Cheryl, call 011 763 4632 or email: cheryl.theagencysa@gmail.com