How to Conduct a Smooth Real Estate Transaction: Tips for Buyers and Agents
Buying property, especially a home, can be an emotional experience. As a buyer agent, you play a crucial role in facilitating a smooth transaction. You must remain level-headed, act as a mediator, and help set realistic expectations for your clients. While some deals can be completed with minimal negotiations, others require a lot of back-and-forth over price, repairs, timelines, and more. Your ability to handle these negotiations with ease can make all the difference in creating a positive experience for your clients. To conduct a seamless real estate transaction, here are some tips to show you how.
Making an offer
When crafting a real estate offer, it’s important to keep in mind that it requires a skillful approach. A successful offer strikes a delicate balance between price, contingencies, terms, and timeframe. To ensure that you arrive at an agreement with the most advantageous terms, it’s essential to educate your buyers about the market and key considerations when creating an offer. These include factors like timing and contingencies.
- Comparable properties
- Number of days on market
- Closing dates
- Requests to sellers to pay closing costs
- Timeliness and types of inspections
- Financing
- Property insurance
- Repairs (if any)
To ensure that this initial stage of the real estate transaction goes well, it’s important to submit the offer in a timely manner. While there may or may not be a definitive time limit in each state (such as 24 hours), it is in everyone’s best interest to submit the offer as soon as possible.
Competing with other buyers
When buyers are faced with competing offers, it can be a mix of emotions, ranging from excitement to stress and anxiety. In such a scenario, it’s essential to remind buyers to consider the value of the property to them and revise their offer accordingly. It’s crucial to keep in mind that apart from the price, other terms such as closing dates and concessions can also play a significant role in the seller’s decision.
In a strong seller’s market, it’s not uncommon to receive multiple offers simultaneously. However, it’s important to note that the seller can only negotiate one offer at a time until a binding contract is signed. In such situations, buyers can take solace in knowing that they have given their best offer.
What if you have two clients interested in the same property?
It’s possible that you’ll encounter two different buyers who are interested in the same property, which can be a challenging situation. As a professional, you have to ensure that you don’t favor one client over the other, while still fulfilling your fiduciary and statutory obligations to both. Therefore, you’re not allowed to provide any price or strategy advice, nor can you advocate for either client. The information must remain confidential, and you must inform both buyers that you’re representing two parties interested in the same property. If you’re not comfortable with this situation, you can suggest to one of the buyers that they may want to work with another agent.
Negotiating counter offers
If the buyer’s initial offer is not satisfactory to the seller, for instance, if the offer price is too low or there are too many repair or inspection requests, the seller may present a counteroffer. It is essential to inform the buyers about this potential outcome to avoid catching them off guard. Despite being taken aback by a counteroffer, the buyers have the option to decide whether or not to accept it at this stage.
- Accept the counter offer
- Counter the counter offer
- Reject the counter offer and walk away from the property
If the buyers decide to write up another offer (the second counter offer in this case), they are rejecting the seller’s counter offer. This means the seller then has the opportunity to:
- Accept the counter offer
- Counter the counter offer
- Reject the counter offer and walk away from the buyers
This can be confusing, but it is essential to know which party is obligated to the purchase and sales agreement and when. Sellers can only negotiate with one buyer at a time. Buyers can only negotiate with one seller at a time (unless they wish to own more than one property!).
Completing the final steps of the real estate transaction
Congratulations on getting the acceptance and being under contract. However, your work is not yet complete. It is important to ensure that the buyers stay on track. There are some time-sensitive tasks that need to be taken care of before you can reach the final destination of closing the deal.
- Financing
- Inspections
- Availability of property insurance
- Appraisal
- Title search
- And, finally, closing procedures
Navigating the choppy waters of a real estate purchase is not easy. There are many important factors to consider, deadlines to meet, and terms to negotiate. A good licensee is one who is knowledgeable and competent, an effective communicator and negotiator, and one with a full understanding of how to conduct a real estate transaction.
