It’s no secret people love to save. So, it only makes sense we want to negotiate when buying a home whether it’s to lower the overall asking price, asking for a new roof, or other upgrades and fixes.
Real estate agents and the homeowners actually expect this and, in most cases, bake in some wiggle room for negotiation.
The negotiation process is usually where a realtor earns their money and they should be able to take care of most of the work here.
However, it helps to know the process so here is how negotiating works when you’re buying a home.
Before any negotiations, get a home inspection
Beyond the fact this is the safest thing to do anyway, an inspection is generally where you’ll find bargaining chips to negotiate lower prices or repairs paid for by the current home owner.
A home inspector will search for any issues with the foundation, an aging or already failing roof, the HVAC system, and more.
After they’re done, the inspector will then give you a copy of the report to look over with your real estate agent.
Please keep in mind an inspection is not an appraisal and neither is a good substitute for the other.
An appraiser will give you an estimate of the home’s worth. However, they do not give you a detailed breakdown on what problems there are with the home.
How to negotiate a new roof when buying a home
It’s not uncommon to find a house on the market with a roof that’s reaching too old of an age or is damaged.
If an inspection reveals the home you wish to buy needs a new roof, the first thing you should do is get a quote from a roofing company. Then, have your realtor take the quote to the sellers.
It’s unlikely the seller will offer to pay for the entire job, but they might offer what’s called a seller concession. They can either offer to pay a percentage of the costs for a new roof or make up the costs to you in other ways.
Sometimes, the seller will offer a replacement roof before closing. This is usually not a good idea because they have control of the cost and can easily just get the cheapest replacement possible.
The best outcome for a homebuyer is to get the seller to pay a percentage of a quote you get from a roofing company you trust and have the work completed after closing so you are in control throughout the repairs or replacement.
How to negotiate repairs when buying a home
Negotiating repairs goes the same way as in the roof scenario above. If an inspection turns up problems with the home’s plumbing, electrical problems, or even cosmetic damage you wish to have repaired you need to get a quote first.
Then, again, your real estate agent can take it to the seller with your wishes.
The best outcome here is a credit for closing costs or for the repairs to be paid for by the seller through an escrow account – a temporary account that holds the money until the fulfillment of your home purchase.
Ask the seller to pay closing costs
One of the most common things homebuyers ask for, especially first-time homebuyers, is for the seller to pay closing costs.
Closing costs are fees and expenses surrounding the loan, appraisals, title insurance and searches, deed recording fees, credit report charges, etc.
How much your closing costs are will depend on where the home is and how much the total price is, but it typically varies between 3-5% of the purchase price.
If there’s nothing really wrong with the home, but you’re wanting a lower price this might be the best way to get a discount if you happen to be looking during a buyer’s market.
The seller may only agree to pay a percentage of the closing costs.
How much should you ask off the asking price of a house?
Most homebuyers’ first offer is 5-10% below asking price if they are going to try to negotiate a lower price.
However, you will need to do your research first on what similar homes are selling for, or have recently sold for, in the same neighborhood.
If their home is priced on-market, you might be able to get 5-10% off if there’s minor updates needed or if the home has been on the market for a few weeks.
If the home needs a major remodel in one or more of the rooms or if the whole place needs new carpet or something, you might be able to get more of a discount.
The only time you’ll have success asking for 20% or more of a discount is if the house needs the roof replaced, the foundation has major issues, or the home is in otherwise significant disrepair.