Homebuyers Are Now Getting Back Some of Their Negotiating Power

 

There is good news for anyone considering purchasing a home today. Although there is still a sellers' market, it is less aggressive than it was the previous year. The days of thinking that you might need to forego contingencies or substantially overpay the asking price in order for your offer to be taken into consideration may also be coming to an end.

As a buyer today, you ought to have less competition and more negotiation power. This is due to the fact that buyer demand and bidding battles are less intense this year. Therefore, if bidding wars were the main reason keeping you away from the market, the following two trends might be precisely what you need to get back into it.

1. The Return of Contingencies

In order to win a bidding war, more buyers during the past two years have been prepared to forego crucial phases in the home-buying process, such as the appraisal or inspection. Less people are now deciding to forego the examination and appraisal, nevertheless.

According to the National Association of Realtors' (NAR) most recent statistics, fewer purchasers are choosing to forego a home inspection and appraisal. More sellers are now accepting offers with these stipulations, according to a recent realtor.com poll. According to their August study:

• 95% of sellers reported buyers requested a home inspection
• 67% of sellers negotiated with buyers on repairs as a result of the inspection findings

This proves that purchasers are better equipped now to include these requirements in their bids and to engage in necessary negotiations based on the findings of the inspection.

2. Sellers Are More Willing To Help with Closing Costs

Closing costs typically represent 2% to 5% of the home's buying price. Prior to the pandemic, it was a standard negotiation strategy for sellers to pay for a portion of the buyer's closing fees in order to improve the terms of the purchase. During the two-year period's peak buyer's frenzy, this didn't occur as frequently.

It reveals that 32% of sellers in today's market covered all or part of the closing fees for their buyers. You might use this as a negotiating tactic while buying a house. Just keep in mind that your lender may have restrictions on closing cost credits, which might differ by state and loan type. To learn how much a seller can contribute to closing costs in your location, consult with your loan advisor attentively.

Despite the past few years' intense competition in the home market, data from today suggests that discussions are beginning to return to the table. If you intend to enter the home market, this is fantastic news. Contact your neighborhood real estate advisor right away to learn more about how the market is changing in your region.