New Jersey Real Estate Agent

The obvious goal of most New Jersey real estate buyers (Princeton area home buyers not being an exception) is to buy the home they like at the lowest possible price. In the buyers market this should be an easy task, but it is not always the case for several reasons.

Conflicting Priorities

In many aspects of life having your priorities straight is the starting point to pursuing a goal. The traditional way most New Jersey home buyers used to search for Princeton homes for sale was to  find the home they liked first and then negotiate for the best possible price.

What I see now is that many home buyers are reversing this order and trying to start by hunting for the best price bargain. They look for properties with biggest price reductions, or what they perceive properties with “desperate” sellers. They wait for further price reductions, even when the house meets their needs. This causes confusion for many buyers as they spread their search in many directions instead of first focusing on finding the house that meets their needs.

Offers Based on Misinformation

It is difficult to understand what happens to real estate prices based on the available reports.

Read: Understanding Princeton Real Estate Prices

Princeton Township Prices 2004- 2008

“The house at 123 Main Street had the price reduced by $XXXK, so we should offer $XXXK less for the house on the 123 Other Street ” says the buyer. This idea could be totally wrong, unless they compare identical houses in terms of location, age, size, amenities, condition, presentation (including seller’s furnishings). In Princeton, Montgomery Townships and many other other towns it is rarely the case because the housing inventory differs greatly. As home buyers you can’t always transfer information from one house to another, sometimes even if they are located on the same street.

Waiting For Further Price Reductions

There is an expectation by the home buyers  in today’s Princeton real estate market  that all houses placed on the market would or should have price reductions before they are sold. These expectations are based on the fact that many New Jersey homes including Princeton homes for sale, were overpriced from the start and had multiple price reductions before they went under contract.

It is not the case with all houses and there are many that are priced right, having already taken into consideration the Princeton real estate market decline. These houses sell quickly, and the buyer’s waiting for further price reductions miss out on potentially good deals.

Low Ball Offers

There are home buyers who believe that the only way to be assured of getting the lowest possible price is to offer a low ball offer. By low ball I mean offers not supported by logic and relevant data.

When I represent sellers I usually counsel them to respond to all offers. Many sellers in today’s market would not counter offer on a low ball offer. When this happens, the buyers do not get to find out how low the seller was prepared to go by cutting off any possibility for negotiation. The only thing gained  by this approach is for Princeton home buyer finding out something they knew going in – their offer was too low.

Offer & Acceptance Is The Beginning

Real estate transactions are often complicated and require good will from all parties: sellers and buyers, to successfully get to closing. Sometimes so much negative emotions are expanded by both buyers and sellers in the negotiations phase, there is little  good will left to see the transaction through.
Getting the best price needs to be done with this thought in mind.

As I was finishing this article, I received a call that my buyer’s offer was accepted. I am very happy that my clients are getting a great deal, and the process to get to closing could now get started with all the parties good will intact.

Photo by fritz_da_kat

Related Articles:

Princeton NJ Real Estate – Everything You wanted to Know

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