Published: March 13, 2023 | By: Inman
It’s been a long couple of years for homebuyers and their agents.
The pandemic-fueled tornado of low inventory, tons of buyers flocking the market amidst record-low interest rates, and would-be sellers holding onto their homes for fear of being left out in the cold with no place to go, made for a brutal homebuying experience in many places.
“Last year, it was pretty much come in every house guns blazing, do whatever you could do to acquire that house,” MaxStokes of Compass in Northern New Jersey told Inman.“There was no negotiation over the last couple of years.”
But the tides are turning.
Volatile — and comparatively high —interest rates coupled with an uncertain economy are starting to shift the market’s balance. Sellers don’t have the hold on the market that they once did. And it’s time for buyers to start taking advantage of the shift.
As a balanced market comes into view on the horizon, here’s how buyers’ agentsare changing their negotiation tactics to help their clients achieve some winsthat were once impossible in the frenzied market of the last two or so years.
On new development properties in Manhattan, where Leslie Singer of Brown Harris Stevens works, the taxes folded into closing costs can be a lot to swallow. In the past few years, sponsors (another term for developers) have typically put the onus of mansion and transfer taxes on the buyer of the property.
On New York City properties priced below $500,000, transfer taxes are 1 percent and on pricier properties, that tax increases to 1.425 percent. Mansion taxes kick in on properties priced at $1 million or higher and rangefrom1percent to3.9percent, depending on the exact price.
But in this market, Singer said developers are a lot more willing to negotiate.
“In these types of markets, sponsors may be more flexible on the backend, such as assisting with closing costs,” she told Inman.
With inventory staying on the market a bit longer these days, buyers have the time to comfortably compare different active listings — and potentially leverage them against each other if a seller is really being a stickler when it comes to negotiating, Stokes said.
With properties that he has represented recently, Stokes said homebuyers have pointed out to him other similar properties in the same market, and why they might be a better offer than his own listing, lighting a bit of afire under the seller.
“[They’re] pointing out the differences in the comparables that are on the market and trying to leverage three [listings] against each other,” Stokes said
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