Negotiating In A Buyer’s Market

By Elizabeth Kohen | January 21, 2020

If you’re house hunting, the phrase buyer’s market is music to your ears. And while there may be a good chance your bid below the asking price gets accepted by a motivated seller, you should also be aware of the finer points your broker may have the power to negotiate.

Offered Amount

When deciding how much to offer, consider how long the property has been on the market, whether it needs extensive upgrades or repairs, if different brokers have previously marketed it and the price comparable properties have recently sold for. Though not an option for every buyer, an all-cash offer can entice a seller to accept a lower price, since it eliminates barriers like a bank appraisal and virtually ensures a quick closing without significant hurdles.

Deposit/Down Payment

The standard deposit a buyer puts into escrow upon signing a contract is 10% of the purchase price. In a buyer’s market, the seller might agree to a lesser deposit of 5%, freeing up your resources and putting less of your money at risk in the transaction. The standard down payment in NYC is 20%, and some co-ops do have strict requirements when it comes to down payment amounts, but home sellers of condos and freestanding houses may be negotiable.

A Little Something Extra

The seller might be willing to go the extra mile to strike a deal, so you could try asking for a home warranty protection plan—which would cover you if there were issues with appliances, heating or plumbing—or you might even consider asking for an appliance that is not already included with the sale. House hunting in a new building? That could mean an eager developer, and your opportunity to request custom finishes or upgraded appliances. They might even be willing to cover your common charges or real estate taxes for a specific duration. Fancy the furnishings? Why not ask for them to be included with the purchase? Get creative!


A financing contingency is a given in a buyer’s market if you’re pursuing a loan, but you may also be able to negotiate other challenging contingencies, such as a sell-to-buy contingency, making the deal contingent upon the sale of your current property. This can be tricky, but an experienced agent and attorney can strategize to ensure a successful deal that ultimately protects your interests but would be accepted by a motivated seller.

Home Inspection Renegotiation

If a home inspection reveals defects that weren’t previously known or disclosed by the seller, you might consider renegotiating. This could mean asking for a closing credit (see below), requesting that the defects be resolved by a licensed contractor prior to closing or calling for an overall price reduction in order to move forward with the deal.

Closing Credit

Cash and Coins Scattered on Desk with Plant and Candle

Photo by Katie Harp

Developers might not want to negotiate the purchase price when they have several comparable units listed on the open market, as they don’t want to risk their bottom-line and hope to achieve a certain price per square foot for their portfolio. However, they may be willing to offer you a closing credit. Also known as a seller concession, a closing credit is money a buyer receives from the seller at closing to enable cash on hand for initial repairs or in lieu of a price reduction. If you simply negotiate money off the sales price, you will be reducing your mortgage but this does not translate to cash in hand, whereas a closing credit puts money directly into your pocket at the closing table.

Closing Costs

When buying into a new condo development or from a sponsor of a co-op, it is customary for the buyer to cover the seller’s closing costs in addition to their own. In a buyer’s market, you can propose that a developer or sponsor cover their attorney fees, as well as the title insurance, city and transfer taxes, escrow costs or additional items that buyers often pay. When purchasing a resale property, you might even suggest that the seller pay your closing costs in addition to their own.

Closing and Possession Dates

Whether you prefer to close quickly or delay the closing date, you hold the power in a buyer’s market to suggest a timeline that works best for your needs.

Purchase Consolidation Extension and Modification Agreement (CEMA)

When buying a single-family home or condominium, if you’re pursuing financing and the seller is still in the process of paying off their own mortgage then a purchase CEMA might be worth pursuing. This involves combining the seller’s existing mortgage with your new mortgage and modifying the terms to current rates, saving you a significant amount in mortgage taxes. A buyer then only needs to pay taxes on the funds they are borrowing from the bank minus the portion they take on from the seller. The seller also benefits via a continuing lien reduction. The only drawback is that this process can add a few weeks to the purchase timeline.

Once you decide what you want to negotiate, it’s helpful to strategize how to make your bid more attractive.

In any market, we recommend seeking out the support of an experienced real estate agent who will advocate for your needs. You might not realize the myriad facets of negotiation and added protections that are available to you, and a highly skilled agent in your corner can be your biggest asset when embarking on the most substantial purchase of your life.

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