Buying a house is definitely one of the biggest decisions you’ll make in your lifetime. There’s so much to consider and it can sometimes feel like you’re negotiating a minefield. But fear not, we’ve got your back! This comprehensive list takes a deep dive into 10 crucial things to negotiate when buying a house. Buckle up!
Contents
1. Purchase Price
This may be obvious, but negotiating on the purchase price is the first thing you need to focus on. Don’t just go by the listed price; remember, it’s just the seller’s asking price and not the final word. Study the market value, understand the local real estate economy, and compare prices before making an offer. Engaging with a real estate agent can help proficiently in this process as they’re well-versed in market dynamics and pricing strategies.
2. Closing Costs
Closing costs can often take buyers by surprise. These are additional costs including loan origination fees, inspection fees, appraisals, title searches, and more incurred during the home buying process. However, these are not set in stone and could be reduced or even shared between you and the seller. Also, getting different quotes from financial services companies for mortgages can also help bring down the overall closing costs.
3. Inspection Repairs
No house is perfect which is why home inspections are mandatory in many areas before closure to check if there are any costly issues lurking beneath the surface. If defects do arise during the home inspection, these can often translate into an opportunity for negotiation. Use these property issues as leverage to further reduce the purchase price or have the seller fix them before you move in.
4. Home Warranty
It’s worth discussing a home warranty during your home buying negotiations. A home warranty typically covers repair and replacement costs for home appliances and systems like HVAC, plumbing, and electrical. This could save you significant amounts of money in the long run if any of these essentials break down.
5. Property Survey Costs
The cost of surveying your new property can also be negotiated. A precise survey helps establish the exact boundaries of the property, which can be essential for avoiding future neighborly disputes or when planning renovations or extensions. Engage a private sector specialist to get this done, and try getting the seller to bear at least part of this cost.
6. Possession Date
The possession date is not only about when you can move into your new home. It’s also a critical date in your financial plan as it marks when your mortgage payments start. If you’re renting the home you’re currently living in, timing the possession date close to your lease end date will mean you avoid paying rent and mortgage simultaneously.
7. Included Appliances
Included appliances are often something overlooked during homebuying, but they are vital to save extra expenses later on. Make sure you negotiate this as part of the purchase agreement early on so you know what appliances like dishwasher, refrigerator, washer and dryer come along with the house.
8. Furniture Inclusion
Furniture inclusion can be another point of negotiation while purchasing a house. Sometimes, sellers are willing to include some furniture pieces like outdoor patio furniture, large dining tables or bookcases that would be cumbersome to move. This can save you substantial amounts in furnishing your new home.
9. Settlement Date
The settlement date is when the purchase is finalized, and it impacts your finances directly. Try negotiating a settlement date that aligns with your financial cycle. For instance, choosing a settlement date towards the end of the month can reduce the interest you’ll pay on your loan origination.
10. Lease-back Agreements
It might happen that the seller needs more time to vacate even after the settlement. In such cases, do negotiate a lease-back agreement which allows them to rent the house from you for a fixed period of time. It’s important to establish clear terms including rent and length of stay in this agreement.
