How to Negotiate Your New Home Purchase

July 5, 2019

Negotiate Your Home Purchase

Buying a home is likely the biggest purchase -- and one of the biggest commitments -- you will ever make. It’s important to ensure that you don’t overpay by getting the best deal possible, which is where stellar negotiations can come in real handy.

If you’re looking to snag the home of your dreams while also saving as much money as possible, your (and your realtor’s) haggling skills will be paramount. Here’s a look at our top tips for negotiating your way into your next successful home purchase.

Research Your Market

Before you ever begin negotiating -- or honestly, even shopping around -- it’s important to know the type of market you’re facing. Your approach to the buying process can vary depending on whether it’s a buyer’s or seller’s market, and whether it’s active or slow at the time.

A buyer’s market is obviously favorable. This will give you the opportunity for more wiggle room on pricing, as well as flexibility when it comes to offers, closing dates, and even seller’s allowances. 

However, you might be facing a seller’s market instead. This doesn’t preclude you from still getting a great deal on a beautiful home, but it does mean that you might need to accept a higher price than you’d prefer. A seller’s market will even change the way you put in offers.

Regardless of the type of market, you’ll want to move quickly and respectfully when you find the right property. In a seller’s market, this is even more important as you don’t want to risk losing the home to a faster (or more competitive) buyer. 

Utilize Your Pros

One of the best tools at your disposal is your real estate agent. They are great for many things, including communicating with the seller and seller’s agent(s) and negotiating. This almost always results in a more favorable outcome, versus you reaching out to the seller’s team yourself. 

Your agent will also help run comps in your area. These comps give you an idea of the market at the exact time you’re looking to buy. They also offer an inside look into what other buyers are paying for similar properties in the same area. 

Your agent is also invaluable when it comes to sending offers, making reasonable demands, and navigating the process before closing.

Pick Your (Important) Battles

There are a few basic components of home-buying negotiations: the price you’re willing to pay for a house and what you request in return. To make the most of the buying process, it’s important to negotiate the right things.

If it’s a buyer’s market or sales in your area have been slow, you may be able to squeeze more from the deal. For instance, you could ask the seller to cover some or all of your closing costs, saving thousands.

Conversely, if it’s a competitive seller’s market and you don’t want to miss out on your dream home, you can use the negotiation process to sweeten your offer. This might mean putting up a higher earnest money deposit, or covering the seller’s closing costs. It’s an added expense, sure, but might be well-worth it to you to avoid losing a home you love.

Come In Funded

One of the strongest moves a buyer can make is to come in fully funded. This makes any offer you submit more attractive to the seller, while also giving you additional leverage for negotiations. 

Mortgage pre-approval means that the lender has done the foundational underwriting work, and already given you the green light for a loan that will cover your offer. It tells the seller that the closing process will be both easier and faster, and the sale has a much smaller chance of falling through.


Having a pre-approval letter -- or coming in with a cash offer -- gives you power as the buyer. It also allows your offer to stand out among the competition.


Preparation is Key

Whether you’re buying your first home or your fifth, negotiations are nerve-wracking. It’s important to know what you’re up against and how much leverage you are bringing to the table.

Gauge your current market and see how other homes are selling. Come in prepared with a strong, but fair, offer and know what you want out of the deal. By being both informed and funded, you’ll ensure that your offer is the best one on the table. And this will make the negotiation process as easy and pain-free as possible.