Buyers Are Going To Lose Their Negotiating Power
On October 9, 2007, I wrote a blog article called "Seller's Are Losing Their Negotiating Postion". Right now, buyers have all the power.
But buyers need to beware of this: When the market "bottoms out" -- and it will, we just don't know when -- buyers will quickly lose their position of strength for negotiating real estate prices and terms.
Someday, the St. Petersburg Times, the Tampa Tribune, CNN, ABC, Fox, and all the other media will all be running stories that tell about real estate's remarkable and rapid comeback. They'll have experts saying that the bottom was reached thirty days ago and now's the time to buy and blah, blah, blah. Gurus are always gurus a month after something happens -- have you noticed that?
Well, if you're a buyer, here's what is going to happen to you when the bottom is reached. Frustrated fellow buyers are going to come out of the woodwork. There's going to be a lot of pent-up demand for housing. Buyers are going to gobble up the immediate "good values" and cut into the available inventory in a big way.
Seeing that real estate activity is heating up once again, sellers are not going to be so anxious about the sale of their property. They aren't going to drop their prices and let buyers name their own terms like they will today. Once that bottom is reached, you as a buyer are going to find yourself in a weakened negotiating position. Your position will grow weaker every single day that the real estate market is rebounding as sellers begin to retake the higher position in each transaction. It probably won't be too long after the market bottoms-out that sellers once again hold the upper hand and will wait for the next offer to come along.
You think I'm wrong? You think that won't happen? Did you try to negotiate a low price and favorable terms with any sellers during, say, 2003 or 2004? How much success did you have? Be honest about your answer, because I already know how much success buyers were having negotiating with sellers back then. They were so successful in their negotiations that the only way you could buy a house was to bid up its value and pay more for it. Remember?
If you're a buyer, the time to buy is RIGHT NOW. Sellers are anxious. Motivated. Desparate. Willing. Nervous. Going broke. Pick your descriptive adjective. The point is that you can practically name you're own price in some cases.
This is a situation that is fluid. It can change the minute, the second, the nano-second the market reaches "bottom-out" mode and starts to climb back up. Those changes will weaken and then destroy the buyer's ability to neogiate favorable price and terms on many properties.
My suggestion to buyers? Buy now while you still have some negotiating leverage.
For more informtion on real estate in the Tampa Bay area, visit my website at http://www.thestpeterealestatesite.com/.
But buyers need to beware of this: When the market "bottoms out" -- and it will, we just don't know when -- buyers will quickly lose their position of strength for negotiating real estate prices and terms.
Someday, the St. Petersburg Times, the Tampa Tribune, CNN, ABC, Fox, and all the other media will all be running stories that tell about real estate's remarkable and rapid comeback. They'll have experts saying that the bottom was reached thirty days ago and now's the time to buy and blah, blah, blah. Gurus are always gurus a month after something happens -- have you noticed that?
Well, if you're a buyer, here's what is going to happen to you when the bottom is reached. Frustrated fellow buyers are going to come out of the woodwork. There's going to be a lot of pent-up demand for housing. Buyers are going to gobble up the immediate "good values" and cut into the available inventory in a big way.
Seeing that real estate activity is heating up once again, sellers are not going to be so anxious about the sale of their property. They aren't going to drop their prices and let buyers name their own terms like they will today. Once that bottom is reached, you as a buyer are going to find yourself in a weakened negotiating position. Your position will grow weaker every single day that the real estate market is rebounding as sellers begin to retake the higher position in each transaction. It probably won't be too long after the market bottoms-out that sellers once again hold the upper hand and will wait for the next offer to come along.
You think I'm wrong? You think that won't happen? Did you try to negotiate a low price and favorable terms with any sellers during, say, 2003 or 2004? How much success did you have? Be honest about your answer, because I already know how much success buyers were having negotiating with sellers back then. They were so successful in their negotiations that the only way you could buy a house was to bid up its value and pay more for it. Remember?
If you're a buyer, the time to buy is RIGHT NOW. Sellers are anxious. Motivated. Desparate. Willing. Nervous. Going broke. Pick your descriptive adjective. The point is that you can practically name you're own price in some cases.
This is a situation that is fluid. It can change the minute, the second, the nano-second the market reaches "bottom-out" mode and starts to climb back up. Those changes will weaken and then destroy the buyer's ability to neogiate favorable price and terms on many properties.
My suggestion to buyers? Buy now while you still have some negotiating leverage.
For more informtion on real estate in the Tampa Bay area, visit my website at http://www.thestpeterealestatesite.com/.
posted by Terry Ward at 6:28 AM
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