When surveyed, homeowners report they want a real estate agent who can help negotiate and “deal” with buyers. Whether you are beginning the licensing process or have been an active real estate agent for years, you must learn the art of the real estate counter offer to better serve your clients. So, here is how to negotiate counter offers on a home sale – in addition to sellers agents negotiation tips.
What Is a Real Estate Counter Offer?
A real estate counter offer is a response from the seller to a buyer’s offer on a property. While a counter offer rejects the buyer’s original offer, it aims to keep negotiations open by proposing new terms. Those terms may include changes in the purchase price, closing date, or contingencies.
Counter offers are part of the real estate negotiation process. The process may go back and forth between the buyer and sellers until both parties agree to terms or one party decides to walk away from the deal.
Why Are Real Estate Counter Offers Important?
Real estate counter offers are important for several reasons.
- Real estate counter offers are a crucial part of the negotiation process.
- They help provide clarity as to the most important considerations for both parties.
- Counter offers can be used to address specific concerns that may arise during inspections or appraisals.
- Counter offers are often essential for reaching a final agreement.
How a Real Estate Counter Offer Works for a Sellers Agent
A sellers agent must promote their client’s best interests. Here’s how a sellers agent negotiation typically works.
1. Understand the market.
To be successful, seller agents must have a deep understanding of the local real estate market. Part of that understanding comes from researching recent sales and market trends in the area and identifying comparable properties and their selling prices.
Having this knowledge will allow you to best guide your client on acceptable prices and terms.
2. Evaluate the buyer’s offer.
Once your client receives an offer, it’s up to you to review the terms and contingencies of that offer and assess the buyer’s financial strength. Your client needs to have all the critical facts presented to them to make a decision regarding that offer. If your client thinks the offer is good, no negotiations or counter offers may be necessary.
3. Formulate a counter offer.
If your client is not satisfied with the price or terms of the offer, you will need to work with your client to formulate a counter offer strategy. This process may require finesse, as your client may not have realistic expectations. As a sellers agent, you’ll work with your client to determine their bottom line and negotiation boundaries.
4. Craft the counter offer.
Your client will look to you to formally submit a counter offer based on the property’s market value and sellers’ goals. In your counter offer, you may address contingencies and special requests from the original offer and give the buyer a deadline to respond.
5. Communicate with the buyer’s agent.
It’s critical that you have positive relationships with other agents in your area because you will need to have open lines of communication with them during the negotiation process. You may need to explain the rationale behind the counter offer to the buyer’s agent so they better understand your client’s priorities.
6. Finalize the deal. (Hopefully)
There may be many counter offers during the negotiation process. Hopefully, this will result in a deal that both the buyer and seller can live with comfortably. From there, you can ensure all parties fulfill their obligations and facilitate the closing process.
Negotiation Tips for Home Sales
How do you make everyone involved in a real estate transaction happy? Here are some negotiation tips for selling houses. Learn more about real estate negotiations with this blog: 11 Tips to Master Real Estate Negotiation.
Know your client’s priorities
Understand what matters most to your seller. Is it getting the highest price, closing quickly, or avoiding certain contingencies? Tailor your negotiation strategy accordingly.
Stay informed
Monitor market trends, recent sales, and competing properties continuously. This knowledge will help you justify your counter offer and negotiate from a position of strength.
Respond strategically
Time is often of the essence in negotiations. Be strategic when you submit a counter offer.
Prepare responses to anticipated rejections
Having counterarguments ready can help overcome objections and keep negotiations moving forward.
Maintain a positive relationship with the buyer’s agent
Build rapport and maintain open communication with the buyer’s agent. A collaborative approach can lead to smoother negotiations and a higher likelihood of reaching a mutually beneficial agreement.
Know when to seek advice
You can’t be expected to be a master negotiator immediately. Seek advice from more experienced colleagues to help navigate challenging situations effectively.
Document everything
Keep thorough records of all communications and counter offers exchanged during the negotiation process. This documentation can serve as valuable evidence and protection in case of disputes or misunderstandings.
Colibri Real Estate School can help you earn your real estate license – and upgrade your license when you are ready to advance your career. Our continuing education courses will also help you improve your client services while completing required courses for re-licensing. In short, Colibri Real Estate School can help you become a better seller’s agent.
Key Takeaways: Home Seller Negotiation Tips
- Counter offers are essential for negotiation, clarifying priorities, and addressing concerns.
- Understand the steps of writing a counter offer.
- When negotiating, focus on your client’s priorities, stay informed about the market, respond strategically, maintain positive relationships, seek advice, and document everything.
Source:
“What Buyers, Sellers Want Most from Real Estate Agents.” www.nar.realtor, April 4, 2024. https://www.nar.realtor/magazine/real-estate-news/sales-marketing/what-buyers-sellers-want-most-from-real-estate-agents#:~:text=As%20buyers%20reflected%20on%20their%20experience%2C%20they%20reported,search%3A%2023%25%208%20Expanding%20buyer%E2%80%99s%20search%20area%3A%2021%25.
