When prices soar, so does the power of the home seller in the housing market. At its peak a property price boom can mean offers are accepted on properties within hours of coming onto the market. It is a time when asking prices aren’t just met but often exceeded in the best areas.
It is a time that buyers dread. These tips will help buyers make the best of negotiating during a house price boom:
• Assess the local market. The house price boom could be mixed. While in some areas, certain residences may be flying off estate agents’ shelves, in other areas people could still have problems selling. Discover the regions where prices are still low. Possibly there are too many flats for sale. If so take into consideration a flat as an alternative to a house.
• Steer clear of sealed envelopes and bidding wars. In a sellers’ market estate agents will attempt several tricks to make sure their clients gain the maximum value from a house price boom. These include joint viewings to heighten the atmosphere of competitiveness. The worst case scenario is a sealed envelope technique, in which many different buyers make an offer which they think will seal the deal. This can regularly end up way more than the asking price.
• Establish relationships. In a sellers’ market a buyer has to stand out. Not just in terms of being in a position to meet an asking price, but to appear more favourable to the seller. First time buyers and those that have already sold a home are appealing to a seller. They speed up a sale and by not being in a chain the risk of a deal falling through is reduced.
• Be prepared for disappointment. It is vital to not pin your hopes on a single property.
• Stick to your guns. Don’t be tempted to borrow more than you’ll be able afford. Set yourself a maximum figure you are able to go to and stick to it. During a house price boom some people can take on too much debt.
• Think about purchasing at an auction, where prices may be more affordable. However be prepared to carry out a good deal of work on a house marketed at an auction, as properties that come up are often in need of renovation.
• Be aware, prices do not go up forever.