Negotiation Scenario #4: Purchasing a Home
This is the humdinger of financial negotiations. For most people, it’s an emotional decision, and likely the largest outlay of cash they’ll make in a lifetime.
“We fall in love with a house, and we forget about the plan we made—and the limit we set of how much we’d spend,” Wertheim says.
So the first thing you need to do is your research.
“Know the market,” he says. “Unlike with a car purchase, if you delay by a couple of days in a tight market, you could lose the house.”
You’ll also want to look closely at “comps,” or what other comparable properties in the area have sold for, before making an offer, so you’re basing your bid on fact—not your fantasy life.
“We have a saying in negotiating: If you can’t walk, you can’t negotiate. If you fall in love with a job, or a person, or a house, you can’t negotiate.”
And be sure to factor in all of the costs—from your mortgage to condo fees or property taxes, if applicable—to make sure you’re still within budget.
Then resolve not to lose your resolve, because you may fall in and out of love many times. “I bought a house a long time ago,” Wertheim says. “But I remember calling my father-in-law, defeated, after losing house after house.”
And that, he says, is when many people tend to make mistakes. So as hard as it may be, try to stick to your wish list—and your set price.
“Buying a house is a very emotional thing,” he says. “But we have a saying in negotiating: If you can’t walk, you can’t negotiate. If you fall in love with a job, or a person, or a house, you can’t negotiate.”