You’ve made your offer. What happens next?
Unless you have made a full price offer (or even more than a full price offer, if you are not the only buyers making an offer), there is a good possibility that the sellers will make a counter offer to you. Does this mean you should make a really low offer in order to give yourself some playing room as you negotiate back and forth over the price, etc.? Not necessarily. When a home is priced well, expect to pay pretty close to the asking price.
Your Realtor will have worked on your CMA before you ever make an offer. They will most likely give you a value range for the home based on their findings. And with that range, they will recommend generally where they think you should go in with your offer, in addition to what you should expect to end up paying.
In fact, I like for my buyers to have three numbers or positions in mind as they prepare to present their offer. I like to have a “Go In” position, a position or price that you think will be fair to both you and the sellers (yes, I actually want you to think about the sellers’ perspective as you negotiate) and finally, a “Walk Away” position. “Walk Away” is that price where you are willing to walk away from this home and resume your search anew. And not only walk away, but be happy with that decision, comfortable that this is the right course of action for you.
Now, these three numbers are actually fluid, subject to change as you are negotiating. Why? Because, as you get closer to reaching an agreement that everyone can live with, you might find that a difference of $1,000 from your original “walk away” number and where you are right now might not be enough to give up on that dream home, after all.
Most people are both reasonable and fair. And I think if both parties are flexible, reasonable and fair, there will always be a place where everyone will feel good about going under contract. The purchase of a home is a process. The goal is to have this process go as smoothly as possible and have an environment where all parties feel good about the outcome.
Next time, we’ll talk about going under contract.