How to Negotiate on Prestige Property

Recently, we negotiated the purchase of an off-market property in South Yarra on behalf of our clients. The property was a double-fronted Victoria featuring four bedrooms. Our clients were immediately taken with this stunning, complete turn-key property, and we knew it was an ideal match at the right price. The opportunity came through a real estate agent we’ve worked with on several successful transactions.

We submitted an offer based on our assessment of fair market value, aiming to present a price that would encourage the sellers to sell before listing the property on the open market. However, the agent responded to our offer by claiming they had received a higher competing offer on the same terms, urging us to increase our offer or risk losing the property to another buyer. As experienced negotiators, we recognised this tactic. Their proposed figure did not align with current market conditions or reflect a realistic value. Sure enough, once we withdrew our offer, the property was subsequently listed on the open market, revealing that the ‘other’ offer had never existed; it was simply a ploy to pressure us into raising our bid. The property remains unsold several weeks later.

For a less experienced buyer, especially one emotionally attached to the property, this could have been an intimidating situation. Confidence and experience are critical in high-end property negotiations. 

This experience reminded us of the importance of strong negotiation skills in premium real estate. A single misstep could cost hundreds of thousands of dollars. In this article, we’ll share our top strategies for successfully negotiating high-end property deals.

Be Prepared

Thorough research is crucial to understand the market inside and out. In the high-end property market, sales are less frequent, and prices often remain undisclosed unless the property is sold at auction. This can make gauging true market value challenging. By working with a professional buyer’s advocate, you gain access to comprehensive data through our specialised software. Moreover, we maintain strong relationships with local real estate agents, allowing us to stay informed on recent sales and market activity in the area you’re targeting.

Don’t Be Fooled

Real estate agents are hired to secure the best price for their vendors, and they’ll employ various negotiation tactics to persuade you to raise your offer. The earlier example is just one strategy—they have many more in their toolkit. The key to successful negotiations is discerning when an agent is bluffing and when they’re being truthful so that you can adjust your response accordingly.

Take control of the negotiation.

As a buyer, you don’t need to let the real estate agent dictate the course of negotiations. You can take charge and apply your own tactics to secure the property at the lowest possible price and on the best terms. Understanding the right type of offer to make based on the situation is crucial for achieving the best result. For example, in some cases, we recommend starting with a lower offer and gradually increasing it as negotiations progress. In others, beginning with a strong offer and standing firm may be the better approach.

If the property is going to auction, it’s important to decide whether to submit a pre-auction offer or wait until auction day. Many factors influence which strategy will yield the best outcome, and every property and negotiation is unique.

Employ an expert

Buying a home is often one of the most significant investments our clients will make in their lifetime. Engaging a professional buyer’s advocate to assist in finding and negotiating your purchase ensures you make a sound, long-term investment. At Infolio, we’ve been negotiating with real estate agents for over 16 years. As trained negotiators—just like the agents on the other side of the table—we ensure our clients secure their dream property at the best price and under the most favourable terms.

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