More than half of first-time buyers regret not negotiating the price before buying their home, new research shows.
In fact, some first-time buyers are so desperate to get on the housing ladder that one in five are prepared to fork out on average an additional £7,758 to secure their chosen property.
New research from Barclays Mortgages has revealed that 51% of those who bought for the first time in the last five years regret not negotiating a better deal.
The research found that 53% of first-time buyers feared missing out if they were to negotiate, while 35% said the market was so competitive that they would avoid negotiations altogether given the small pool of affordable housing available.
Some 91% of first-time buyers who purchased within the last five years believe there is not enough negotiating advice available
Peter Brooks, Barclays behavioural finance expert, said: “Buying a property is the biggest investment of most people’s lives and it’s imperative that the negotiation process is approached with a healthy combination of pragmatism and fearlessness.
“The biggest mistake many first-time buyers make is to rush into decisions and then panic once they have been made. Always remember to balance your approach and referring to informed and independent advice will allow for a smoother negotiating process for all parties.”
Top 10 tips for the all-important first purchase
1. Be clear and assertive – When buying a property, many parties are involved meaning miscommunication is common. Being clear, decisive and assertive will ensure a faster process which the vendor will ultimately appreciate.
2. Be a good listener – An estate agent is always looking to secure a deal. They will often share insights into the vendors thinking, providing invaluable tips on their priorities and clinch points to secure the sale.
3. Do your research – There are many online tools available that allow prospective buyers to see the average selling prices, school catchment areas and crime rates in the local area. Buyers should always do their research and use this knowledge as negotiation ammunition.
4. Be optimistic but always be willing to walk away – A positive attitude will help engage your counterpart and encourage them to work with you to find a deal, but don’t pin all your hopes on just one property despite the temptation to become attached to a particular property – there are plenty more opportunities out there if this one doesn’t go to plan.
5. Play your cards close to your chest – Estate agents ultimately want the best deal for their client, so letting them know your maximum budget or how quickly you want to move gives them the upper hand in negotiations, which may result in you paying more than required.
6. Be prepared to make multiple offers – It is important to remember that this is a two-way deal and you both want the best possible result. This could mean multiple offers are required to secure the property.
7. If at first you don’t succeed, try, try again – Don’t feel defeated if you are unable to negotiate on the offer price. Your initial offer isn’t your only opportunity to negotiate: have a professional survey done on the property as it might find issues that need addressing and for which you can use to negotiate the final sale price.
8. Know your limits – Stick to a budget and avoid viewing properties that are above your chosen price range. First time buyers should avoid the temptation of looking at more expensive properties and remember to save money for any hidden costs – this might include surveys, insurance, removals and solicitor fees.
9. Be patient – Buying a new property can be time consuming and frustrating, so patience is required. Remember it can take time to find the right mortgage rate or property. It’s easy to forget that both parties are looking for the same outcome.
10. Don’t take it personally – Buying a new home should be seen as a smart investment over an emotionally driven purchase. To help reign in emotions, invite someone else to view the property with you. Since they won’t be living there they can provide a more practical opinion on the property. Buying a property is a big financial deal and one you will have to live with for a long time.
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Whether you’re buying a new home, remortgaging to a new deal or buying an investment property, L&C can help – and you’ll pay no fee for their advice. To find out more, click here.
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