Good morning, everyone!
Welcome to another weekday Morning Edition of the Salt Lake City Real Estate Agency. I’m going to be your host, Alixander, and we are broadcasting live from KW Salt Lake City in Sugarhouse.
With that said I’d like to say thank you very much for being a part of this channel. It means a lot to me that we have a growing audience of people who are interested in the real estate of Salt Lake City and they want to get it every morning. So thank you so much for subscribing, hitting the notification bell, reading the blog on our website, and liking our content on Facebook.
So with that said, let’s jump into today’s video, and today we’re going to talk about price.
Everything comes with a price
A story about price by Alixander
Real estate means location, condition, and price
Now when we’re purchasing real estate, the first thing that we’re buying of course is the location. The second thing that we’re buying is, of course, the condition of the property. The third thing that we’re buying, which a lot of people don’t think of it in this way, is the price of the home. You do buy the price of the home. And so when the seller goes to offer his property of the market, it’s what he does. He offers it and says, this is my asking price.
But you don’t like the price
Well you, as a buyer, you’ll meet with me and you’ll say, “Alix. I’m so excited for this home. I absolutely love it. I gotta have it. But I just hate that price.”
And I’ll say, “That’s great. It sounds to me like price is an issue. Now keeping this in mind when we go to offer, are you saying that you’d like to offer less than what they’re asking?”
“Oh, yeah. I just can’t do it for that price. I just can’t, there’s no way,” they’d say.
“Okay, that’s fine. We can go ahead and make an offer for whatever you’d like to offer for it. It would be within the sellers interest to accept any offer that they like to, and if they like to accept your offer, they just might. But do you mind if I give you some words of caution here?”
And they say, “Of course, “you’re our agent!”
In my experience…
I say, “Great. In my experience, in the last four years of being involved in real estate, price is the buyer’s number one concern when location should be the number one concern. But, that’s okay. And before price, every buyer seems to neglect this, that the condition of the home is more important than the price of it, too. That is why the seller is offering it at that price….
…if you have a problem with price…
But keeping this in mind, the price, when you go to make an offer on that home, and you are saying that you want the price to be less… well, I am fairly certain that the seller is going to be less than interested, less likely, less… happy with your decision to purchase the property. So my advice, take it for what it is and I’ll follow you every step of the way, but I know how this goes….
…the seller has a problem with you.
You’ll make an offer that’s less than his asking price and he will turn it down, or we will be arguing for about a week about the price of the property. It’s okay. If that’s what you want to do, that’s what we do.
My recommendation is give him his asking price under the stipulation that as we go down this road, if the home is not what it’s worth, if the home isn’t what he’s marketing, enough to be that price… the price is going down, or he’s going to put money towards our loan, or he’s gonna fix it. It’s that simple.
…agree to work seller as their buyer…
And a seller who has their price all squared away, it’s done, is going to be more likely to help the buyer get to the Finish Line. This is because, once you’re under contract, the buyer, you have leverage.
…because it all comes down to working together….
See when they go to market the property, the seller’s motivation is to get an offer. When they’re under contract, their motivation is to sell this home. They want to push the buyer past that line.
…or the seller will find another buyer who wants to work together.
The other way, they’re trying to entice them and if you’re not the right one… they’ll just try and entice somebody else.
Offer the seller their asking price
Then investigate the deal together…
So keep that in mind when you go to make an offer on a property, or when we go to make an offer on a property, that I’m going to invite you, please, offer the seller his asking price in your offering, so that when we are under contract…
…because every home has problems…
and there are problems with the home, (and you and I both know that every home has its problems), that when we ask the seller to contribute money towards our loan costs so that we can afford to fix those ourselves, or can he lower the price of the home because it isn’t what you said it was, or can you please just fix those problems…
if you’ve come to an agreement about price with a seller, they’re going to be more inclined to move forward with you.
…and sometime appraisal don’t go well…
And when we meet that appraisal, and the appraiser says, “It’s not worth what you’re offering,” and we have to go to the sellar and we have to say, “Hey, we need to come down on price or, hey, it’s just not going to work out.” It’s going to be a lot smoother transition, every single time, then we’re arguing before you’re under contract.
(Side Note: Analogy to Relationships)
It’s the same thing when you’re in a relationship with someone you care about if you’re already locked into a relationship, you negotiate the things that matter.
If you’re not even in a relationship yet, if you’re not locked in together…. well, if there’s a disagreement…
you just part ways.
… so work towards a win-win, not a win-lose, together.
And if this home is the one you want and price is the issue, then let’s do our due diligence, and find ways that we can make the deal work for us.
At the end of the day, we want to win-win, on both sides.
So I hope that that helps you understand my psychology around price and negotiating price.
I hope that gives you feedback for your next purchase as well. I’m Alixander. Thank you again for joining me for another Morning Edition of the SLC Real Estate Agency here at Keller Williams Salt Lake City
Have a great day.
See you around.