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How to close the deal on your dream home!

Negotiation plays a major role when it comes to purchasing a property. Adopting a realistic approach and arming yourself with knowledge about the current market trends can help you get a good deal.

Knowing the market

After you have zeroed down on the property you want to purchase, it is best you get the rates of other projects in that locality. These rates will help you during your negotiation. Knowing how long the project has been on the market will also help as the builder might want to get rid of projects which have not been sold. See how the project was priced during the pre-launch stage and how the price trend has been since then. If the prices have fallen since the pre-launch stage, you can bargain and get better rates. Doing some background research on the builder will also help you. The builder might be cash strapped and looking to sell in a hurry. There might be some targets that the builder will have to meet as well, so if you have done your research properly you can negotiate a good deal. You can also find out how much of a discount the builder is willing to offer and prepare to negotiate around that amount.

Expressing interest

When you are going to negotiate with the builder, you need to have a pre-approved loan ready. Also, have an amount set aside just in case you have to make an upfront payment. You might also have to make an offer even when you are unsure if the builder will accept it or not. These steps will show the builder that you are a buyer who is serious about making the purchase.

Once this is established, the builder might give you a better deal. Besides this you can also increase your bargaining power if you negotiate as a group.

What to expect

Don’t go in to a negotiation expecting a huge discount. A builder will typically offer a 5 to 7 % discount on the quoted price. If the builder has refused your initial offer, wait for a few days as chances are that the builder might call you back. Some builders might have bought the land when the prices were high and will be willing to wait rather than sell the property at a lower price. So it is essential that you gauge the situation and learn to walk away when the builder refuses to budge. Ensure that you have a set of options ready in case the deal does not come through.

Image: “Irvine apartments” by Tcc8 – Own work. Licensed under CC BY-SA 3.0 via Wikimedia Commons – http://commons.wikimedia.org/wiki/File:Irvine_apartments.jpg#mediaviewer/File:Irvine_apartments.jpg

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