In order to enter into a good negotiation process, you first have to know whether it is the seller or the buyer who has the stronger position in the transaction. The seller is said to have the upper hand if the local real estate market is going strong and houses and lots are selling like pancakes. If the seller is not in the rush to move or if other similar houses were already sold for or above the asking price, then the seller is said to have a strong position in the negotiation. Meanwhile, the buyer is in the best position for a negotiation if the local real estate market is weak. It is to the buyer's advantage if the seller needs to move out quickly of the property and if the house has been in the market for quite a long time now.
In the negotiation proper, the more information you know, the better. During the house visit, you should have taken notes of the repairs or replacements. All of this would be essential in the negotiation. Also, if you, as a buyer, wants to retain some of the appliance in the house, that should also be included in the price negotiation. Make your offer contingent with your financing or with the house passing the professional home inspection. This is especially important for old houses.
There are several steps in the negotiation process that all those who would like to buy house and lot for an affordable rate should be aware of. The first step is for the seller to state his or her asking price. The asking price is the price, which the seller originally listed in the ads or signage. If you are the buyer, a good negotiation brings will lower selling price compared to the original asking price. The buyer, however, should know how much above the asking price he or she is willing to shoulder in case the seller has multiple offers for the same property. If you are the seller, you should be prepared to offer more.
After settling the asking price, it is the turn of the buyer to make the offer. This step is where the buyer states his initial purchase offer to the seller. The offer may come with contingencies such as a requirement that the home pass the professional inspection or that you receive sufficient financing from the bank or any money lending institution.
The final step in negotiation is the acceptance of the offer or counter offer. This is where the meeting of minds of both the buyer and seller happens.
Here is a quick note regarding "hot" market for the buyers out there. If the real estate market where you want to buy a property is considered a "hot" one, meaning properties there are selling pretty quickly above the asking price, do not bid more than what you can really afford. If you find yourself outbid on a number of houses you like, do not gloat readily over it. The right house for you is still out there waiting to be found. It is described as the perfect home only if you can afford it.