Negotiation strategies vary depending on the price range and condition of the house, but the final months of 2010 may be the best time to negotiate on a luxury home thanks, in part, to the capital gains rate going back up on January 1, 2011. Yes, I am going to encourage you to set in motion an action plan that really is a “win-win” negotiating strategy to make one of those really nice homes, your luxury home.
But don’t kick back thinking that you have plenty of time because there is a lot to see (in Northern Virginia) and not a whole lot of time to spare. Take a quick look at your calender and you may already see holiday or vacation plans around the corner… so let’s take a look at what I am thinking about here.
Luxury Home Buyers have a strategy to use, today!
I am not a CPA, but as a real estate agent who has an eye on this specialty market that has a low “absorption rate”, I know that these sellers are well aware of the long-term capital gains rate going back up to 20%. So, any offer that you put together right now (fall of 2010) needs to go to closing before the end of the year.
I mentioned “absorption rate”, and that number will change in every real estate market as will what is defined as luxury homes, million dollar listings, or as Northern Virginia Agents like to call them, upper bracket homes. Looking over the last 90 days in Vienna, Oakton, McLean and Great Falls VA, at homes priced over $1.9 million, the absorption rate is currently over 20 months, and that’s if nothing new was added today.
Understanding this unscientific fact that most listing agents are probably going over with their clients, and the fact their CPA is probably encouraging them to sell before December ends is giving sellers a little extra motivation to negotiate giving the million dollar buyer a home buying strategy that they need to put into action today.
Sale on luxury homes ends soon (actually January 1, 2011)
Okay, there is a sense of urgency here and you should get rolling soon because the inventory that I just looked at has 196 active luxury homes listings for sale (no joke) and it usually takes a month to go from contract to closing.
And reader, before you go charging off calling a bunch of listing agents to let you into a bunch of homes that you just picked out online, know that the home Seller is actually expecting you to have your own agent (a buyer’s agent). Using a buyer agent can help you see all the properties in a shorter period of time, help negotiate from a strong, confidential position, and know that you have a professional working to help achieve your goals. Give me a call or e-mail, or let me know how it goes with a comment right here on the blog.