Nov. 14, 2007 - Buyers: Tactful Negotiations

Buyers: Tactful Negotiations

It's no secret now that it's a full blown "buyer's market" just about everywhere you go. So I thought I'd share a few thoughts with you that might help when your Realtor (hopefully me!) is ready to negotiate that perfect home for you!

Everyone wants to think that they're getting a good deal and lately buyers are telling me that they'll only buy something if they can "steal" it. Always remember that there's such a thing as "fair market value". The definition of fair market value is this: the price that a buyer is willing to pay and a seller is willing to sell after reviewing comparable properties that have sold and that have similar characteristics to the subject property.

Here are some steps to take before negotiations:

1. Gather all comparables and prepare a buyer's Comparative Market Analysis. Your Realtor will help you with this.
2. Assemble all information about the history of the property, i.e., how long it's been on the market, how many price reductions, sales transfers, etc.
3. After you've reviewed the above, arrive at an offer price that is lower than the highest price you would be willing to pay. This should be a fair price based on facts…not just a price you pulled out of the air.
4. Determine what other factors in the offer might help in your negotiations.
   1. Cash or financing? If you can pay cash, or have a large amount of money to put down, then you are in a stronger negotiating position
   2. A letter of approval from your lender should always accompany your offer
   3. Will you pay the title insurance or will the seller? This is completely negotiable. I always suggest that if the offer is substantially lower, say 10% to 20% than the asking price, it would help negotiations if the buyer were to pay the title insurance.
   4. Warranted items. The Florida contract allows for 1.5% of the purchase price to correct warranted items. If you feel the property is in good condition, you can always limit that to a set dollar amount. 1.5% of $700,000 is $10,500. Warranted items are structural parts of the home, like roofs, pool screens, windows, window screens, electrical wiring, plumbing, etc. These items must be in working order and if they're not, the seller has to put them in working order before closing day.

Making the Offer

Now you're ready! The details have been ironed out and your agent (again, hopefully it's me!) has written the Purchase & Sales Agreement for you to sign. Be sure to read it. I can't get over how many buyers don't want to take the time to read the contract. Read it! It's the single biggest investment you'll probably make in your life, so please read it.

I recently made an offer on a house that was listed for $850,000. It was grossly overpriced, based on my research. But, it was the house my buyers wanted. I gathered all the information as outlined above put the offer together ($170,000 less than asking), then I wrote a letter to the sellers.

Make it Personal

In my letter I introduced the buyer. The first paragraph explained who he was and where he worked and lived. The second paragraph explained that the buyer was engaged to be married and that he and that he and his fiancé were both avid golfers (it was a golf course community) and were looking forward to a wonderful life together in their new home. I told the sellers that the buyer was purchasing the home as a wedding gift to his fiancé.

Then I complimented the seller by mentioning some nice comments that I heard the buyer make during the initial inspection of the home. I closed by saying that I was looking forward to working with their agent toward a successful close.

Use Psychology

So now you have everything prepared to give to the seller. Have your agent (me?) put together a file folder with all the documents and back up documents, along with the letter. I do this for every offer. On the outside of the folder, I write the name of the seller, then the name of the buyer. Example: Gorgenson to Royls. Then I staple my business card on the outside of the folder. This folder is the first thing a seller sees. His name and the buyer's name are right out there in front of him. And, with my card stapled to the front, it shows that I am proud to make the offer and that I'm a professional agent. When the seller's agent opens the folder, there is a personal letter to the sellers and they are immediately introduced to the buyer. It puts a personality to the offer. A real person with real needs is offering to buy their home.

Fair Negotiations

If the seller doesn't take your first offer, but makes a fair counter offer, you should do the same. Remember, you have that highest number. So make the counter wisely and be fair. If the seller came down a substantial amount, then you need to come up a substantial amount OR, give the seller something else….more money down, a quicker closing date, you pay the title insurance, etc. When it's time to close the negotiations, just tell the seller's agent that the price is the final price you're willing to pay.

Always remember, knowledge is power. You are in a much better negotiating position when you know all the facts about the home you're purchasing.

More Information

Here are a few links to some great articles about the art of negotiating.

Everyone Negotiates

The Top Ten Negotiating Tactics Everyone Should Know

Letting the Other Guy Have Your Way

I hope this article helps you next time your ready to buy a home.

Call me anytime

Nicki

Nov. 3, 2007 - Sarasota Real Estate October Statistics

Sarasota Real Estate Statistics for October 2007

Price Range	Active Listings	Sold October	Current Pending
$50,000 to $250,000	1060	45	109
$251,000 to $350,000	949	35	54
$351,000 to $500,000	880	34	39
$501,000 to $750,000	712	19	36
$751,000 to $1,000,000	395	6	13
$1,001,000 to $2,000,000	500	8	9
$2,001,000 to $3,000,000	206	4	2
$3,001,000 to $10,000,000+	201	4	2
TOTALS	4903	155	264

It's always interesting to compare Sarasota's real estate stats from year to year. In the month of October, of 2005, we started to see more inventory. The months supply jumped from 4.6 in September of 2005 to 6.25 in October of 2005. I remember this period because no one was really sure what was happening. A glitch? I don't think so! A six month supply is considered a "normal" market, so the month of October of 2005 was about as normal as you get, yet we were at the beginning of the downturn. A seller's market was beginning to give way to an astonishing Buyer's market. A year later, in October of 2006, Sarasota had a 30-month supply and now in October of 2007, there is a whopping 31 month supply of inventory. And, this is only the single family residential market.

The Condominium market in Sarasota Florida shows 3207 active listings and only 91 sold for the month of October 2007. That's a 35.25 month's supply of condominiums.

Sarasota Real Estate Statistics for October 2006

Price Range	Active Listings	Sold Oct '06	Month's Supply
$50,000 to $250,000	706	54
$251,000 to $350,000	1319	64
$351,000 to $500,000	1504	45
$501,000 to $750,000	1756	24
$751,000 to $1,000,000	525	10
$1,001,000 to $2,000,000	546	9
$2,001,000 to $3,000,000	167	9
$3,001,000 to $10,000,000+	160	2
TOTALS	6683	219	30.5

Sarasota Real Estate Statistics for October 2005

Price Range	Active Listings	Sold Oct'05	Month's Supply
$50,000 to $250,000	159	79
$251,000 to $350,000	412	100
$351,000 to $500,000	633	100
$501,000 to $750,000	473	60
$751,000 to $1,000,000	299	33
$1,001,000 to $2,000,000	278	25
$2,001,000 to $3,000,000	119	3
$3,001,000 to $10,000,000+	158	5
TOTALS	2531	405	6.25

Let's all go to the Beach and forget our worries!

Nov. 2, 2007 - Longboat Key

Longboat Key, Florida

Longboat Key is such a special place. It's a place where you'll go to get away from the hustle-bustle of city life. Away from your job, your worries, your kids. Longboat Key is a quiet, island retreat that will make you feel as though you've entered a different world. A world where life slows down, where your mind becomes clearer and your thoughts turn inward and make you reflect on the true meaning of your life.

Yes, Longboat Key is just that kind of place. White sandy beaches, sea oats, sunny skies and beautiful flora and fauna all grace this tropical island just north of Sarasota.

And once you're settled in and you've soaked up some warm, healing sun, you'll want to dine at one of Longboat Key's many fine restaurants.

Euphemia Haye, Harry's Continental Kitchens, Mattison's Steakhouse at the Plaza

The next day, you might decide to go to the Longboat Key Center for the Arts. The art center was established in 1952 and offers classes for young and old alike as well as gallery exhibits and concerts.

Then, you may want to stroll through the Joan Durante Community Park and enjoy the natural surroundings and beauty of the preserved wetlands.

If you need pampering, your membership in the Longboat Key Club will lavish you with their treatments. They have 12 private rooms where you can get a full menu of facials, massage treatments, manicure/pedicure and aromatherapies.

In addition to the Island House SPA, as a member in the Longboat Key Club, you have these other special priveledges:

• 45 holes of championship golf
• PGA certified teaching professionals available for lessons and clinics
• Two driving ranges providing complimentary range balls
• Two golf pro shops offering a full range of equipment and apparel
• 38 Har-Tru tennis courts
• U.S.T.P.A. resident pros offering private lessons and daily strokes and strategies clinics
• Four restaurants from casual to elegant for your dining pleasure
• Private pristine Beach and Pool with complimentary cabanas, umbrellas and towels provided by beach service staff
• Fitness Centre (use included in each level of Membership):
  • Open 7 days a week
  • Weight training
  • Fitness programs
  • Personal trainers for individualized training programs

After a day at the Resort, you might just want to stay in your condo, enjoy a glass of wine and have dinner at home. The Longboat Key Market has a beautiful selection of gourmet foods

Or, you can stop at Publix in the Avenue of the Flowers and get anything you need.

One of my favorite places for lunch on Longboat Key is the Dry Dock Grille. There you can dine outside or inside and have beautiful vistas of the bay. The food is great!

Feel like shopping? Hop in your car and take a ride down to St. Armands Circle, where you'll find everything you need to satisfy all your shopping cravings from designer shoes and handbags, to furniture and accesories for your home.

Satisfy your sweet tooth at Kilwin's Chocolate and Ice Cream or head on over to Tommy Bahamas and have a Mojito! You may even want to take a stroll over to Lido Beach and watch the sunset.

So, there you have it. Everything you wanted to know about the Longboat Key area. Here's a map: