Everyone wants to find the best deal, particularly when it comes to making a home purchase. After all, although the market has been softening, the median sales price for all Manhattan property types (condos, co-ops, and one-to-three family homes) was still about $1.2 million in the third quarter, according to the Real Estate Board of New York (REBNY). Brooklyn properties’ median price was $808,000. This is a lot of money, and it is likely the most significant investment you will make during your lifetime.
You should resist the urge to make the process contentious, however. This is particularly true if you plan on making an offer, but there is a sure way you should conduct yourself, regardless.
Remain mum on criticisms
It is important to remember that this is not merely an investment to the sellers. The apartment likely contains many memories, which makes it is a very personal and emotional matter.
Some people think it is an excellent negotiating tactic to tear down the place by mentioning all the things he or she does not like. The reality is that you have insulted the sellers and probably turned them off. In the event of multiple offers, he or she is more likely to accept the bid from people who appreciate his or her apartment, assuming you and the other party are close in price.
You do not have to praise the property effusively, but we advise acting, respectively. This means keeping any criticisms you may have, particularly regarding personal details such as the decorating, to yourself when you are touring the place. Once you leave the apartment, you can have private conversations with your exclusive buyer’s agent, other decision-makers (e.g., spouse, significant other), and family/friends. Now, you can divulge your honest feelings.
What if you do not like the apartment? You should still refrain from criticizing the unit. Remember, beauty is in the eye of the beholder.
Beyond keeping critical thoughts to yourself, acting kindly to the sellers is always a good idea. A friendly letter to the seller can make a difference and push your offer over the top. Being nice is just a good way to live and sets the tone for the negotiations. Remember, people want to deal with those that they like. It likely will not matter if your offer is below others, particularly by a large margin. But if it is close, it could make the difference between buying the apartment and losing out.
While advocating for your interests, there is a certain way to conduct business. You can make the process a lot smoother by dealing openly and honestly with all concerned, including your buyer’s agent, the seller, and his or her agent.
If you like a property and feel you would like to take the next step and make an offer, the proper thing to do is make a bid on only one property at a time.
You may question why you need to do so, given you likely will not have any future dealings with the seller. There are two very good business reasons for doing so. First, it does not mean you are a pushover, but the seller will appreciate your fairness and honesty. Second, you may wish to deal with either your agent or the seller’s agent down the road. You should leave a favorable impression so that they will want to conduct business with you.
Don’t keep backing out
New York State’s real estate process is notably different from many other states. If the seller accepts your offer, either party can still legally walk away at this point without incurring a penalty. A buyer’s offer sheet may contain the price and only a few other pertinent details. You do not have to sign it nor make a deposit.
Once the seller agrees to your offer, your attorney will represent your interests in hammering out the details. During this time, he or she will conduct due diligence, which includes things such as reviewing the co-op or condo’s financial statements and board meeting minutes, and you should have an inspection done.
Once you sign off, you are “in-contract” to use real estate parlance, and it is legally binding. While you can back out any time before this, you do not want to do this too many times. You may have a valid reason for not completing the deal, such as an inspection that shows you need to make costly repairs or a poor co-op financials.
Otherwise, you have wasted your time, along with your agent’s, the seller, and his or her agent. If you find yourself continually walking away, we advise asking yourself if you are emotionally and financially ready to make a home purchase.
Many take an antagonistic approach to a real estate transaction, which we believe is counterproductive. You will find the process easier and more satisfying if you approach the seller in a friendly and businesslike manner.