What Is Negotiated When You Purchase a Home? More Than You Might Think!

It’s easy to assume that the main (or only) negotiation in the sale or purchase of a home is the contract price, but it turns out that there’s a lot more negotiation — both before and after going under contract.

Most contracts are or should be countered, and not accepted as written. For example, there are 39 different deadlines in the standard contract — everything from when the earnest money check is delivered to when the buyer gets to take possession.

If the seller is given extended possession after closing, will it be free, and who pays the utilities?  It’s all negotiated.

If a contract falls, it’s usually because of inspection issues, so the seller will want that inspection deadline to be as early as possible — preferably within 5 to 7 days. And there are other deadlines which allow a buyer to terminate and get his earnest money back, so a good listing agent will make sure they are reasonable. For example, I have seen contracts in which the deadline for terminating based on the acceptability of insurance costs is a week prior to closing. That’s ridiculous, because it takes only a couple days to get that quote.

The second big negotiation in any transaction is over inspection issues. Some buyers will want to have the seller fix every single problem identified by their inspector. (Once my seller received an inspection objection notice that didn’t even itemize the problems but said, “Seller shall fix everything listed in the attached inspection report.”)

Negotiating what the seller will and will not fix and what the seller might give as a credit in lieu of certain repairs is different in every transaction, and your agent’s experience in handling that process can be critical in obtaining a favorable outcome, whether you’re the buyer or the seller.

As I have written before, I advise my sellers not  to fix many of the known problems prior to putting their house on the market, but to save some of them as bargaining chips during the negotiation over inspection issues. Getting a back-up contract in place also helps with negotiating inspection issues. If the buyer is asking for an unreasonable number of repairs, I’ll provide those demands and the buyer’s inspection report to the back-up buyer. Often that back-up buyer will agree not to ask for any of those repairs, giving the seller the ability to tell buyer #1 that he won’t fix anything. This can be an effective technique.

Having multiple offers presents a great opportunity for negotiating matters that are important to the seller.  For example, a downsizing seller may have lots of furniture he’d like to sell. Rather than have an estate sale, I recommend making a list, with prices, of the items “for sale outside of closing,” and leaving it on the kitchen counter for every visiting buyer to see.  Many times I have been able to have the winning bidder include in their contract that they will purchase everything on that list at the prices shown. In a recent case, the buyer asked that all the purchased furniture be moved to the garage prior to closing — a sure sign that they bought the furniture only so they would win the winning war for the house!

If the home doesn’t appraise for the contract price, the buyer can demand a price reduction on threat of terminating the contract. Since the appraisal deadline is usually very close to the closing date, the seller may feel compelled to accept the price reduction rather than lose the contract.  But a good listing agent knows that the same reluctance exists for the buyer, so oftentimes the seller can negotiate little or no price reduction.

Just Listed: A Veritable Mansion in Alkire Estates

No expense was spared in the construction of this 4,937-square-foot home at 12996 W. 81st Place. The roof, for example, is Italian Ludowici tile. The 18’x20’ kitchen has two Corian double sinks and two dishwashers, a Sub Zero refrigerator and a 2-drawer Sub Zero wine refrigerator. The master bedroom features two master bathrooms (each with a deep whirlpool tub and a bidet) and his-and-her master closets. There are also his-and-her offices.  There’s a wall fresco water fountain in the foyer and three domed ceiling frescoes that were hand-painted by a local artist. Ceiling heights are 10 feet in the basement and 12 to 14 feet on the main level.

There are two oversized garages, each with epoxy floors, radiant floor heat, floor drains, bright fluorescent lighting, and abundant electrical power. The basement garage alone measures over 2,000 square feet and could accommodate at least 5 or 6 cars, but is designed to include a large workshop and man cave. Three boilers provide radiant floor heating not only to the house but to both driveways, patios and decks for snow melting.

At left is a picture of the basement patio. The basement and garage concrete slabs are 8” thick, poured over 5 feet of imported compacted fill dirt. The structure itself is built on approximately 48 concrete caissons. An elevator suitable for a large wheelchair connects the two levels. A 10-camera security system is monitored from the master bedroom where there are two wall-safes, one suitable for long guns. A 22-zone sprinkler system serves the home’s grounds, including an herb garden and two vegetable gardens, as well as the well-manicured greenbelt below the property. My narrated video tour at www.ArvadaMansion.info covers all this and much more! All in all, this is one amazing home that is unmatched in the number of luxury features and quality construction details. Call your agent or Jim Smith at 303-525-1851 for a private showing!  There will be no open house.

Do You Practice Sustainability? Home Renovation Can Be Done Sustainably, Too

Tonight is the fifth in Golden Real Estate’s Sustainability Series. Previous sessions were about home insulation (January), home heating technology (February), solar power (March), and electric cars (April).

This month, the topic is sustainable renovation. Our presenter is an expert in sustainable practices when it comes to home renovation.  His name is Steve Stevens, and he has been my mentor regarding sustainable practices for nearly two decades.

A retired scientist from Bell Labs, Steve has made a lifelong project, it seems, out of reducing the carbon footprint of his 1970s brick ranch in South Golden.

Retired and living on a fixed income, he has developed several habits/practices that are not only sustainable but also have saved him a boatload of money.

For example, he only buys cull lumber from Lowe’s, and he buys returned products (typically mis-ordered) such as windows  and doors, which are then sold for a fraction of their original price.

Steve also seeks out salvaged goods such as windows and doors. As with buying cull lumber and returned products, collecting salvaged products means zero new carbon footprint for doing your renovation. 

Steve, being a scientist by training and passion, always considers the embedded carbon footprint of products, whether it’s food or building materials. How much energy is used to transport the goods you purchase?  For example, are you buying slab granite mined and shipped from Asia, or an alternative material mined or created closer to home?

Steve will share his shopping and construction tips that save money and are also sustainable.

For example, he emphasizes insulation, which should always be your first measure when it comes to saving energy. But what products should you buy, and where should you start?

The session will be held tonight, May 16th, from 5 to 6 pm in the Golden Real Estate office at 17695 S. Golden Road, Golden. There are still seats available. Reserve yours by emailing me at Jim@Golden RealEstate.com

Each of our sessions is video recorded by our friend, Martin Voelker, from the Colorado Renewal Energy Society.  You can watch videos of the first four sessions at Sustain-abilitySeries.info.  This session will also be recorded and posted there.

Big Price Reduction on Listing at the Top of Golden Gate Canyon

A couple weeks ago we listed a home 12 miles from downtown Golden at 1296 Golden Gate Drive. It was listed at $650,000, but it was just reduced to only $595,000.

A special feature is its low property taxes. Because it’s just over the Gilpin County line, the 2018 property tax bill was only $718, yet it is served by Jeffco Public Schools. Call for a private showing today! Take a narrated video tour at www.FoothillsHome.info.

This Arvada Cottage Is ‘Cute as a Button’

You’ll feel like you’re in the country when you visit this home at 8050 W. 50th Ave., just 3 blocks west of the Arvada Costco store.  It was just listed at $475,000.

Built in 1949, the seller has owned it for 25 years. It is on well water, but connected to the public sewer system. The second floor, with its four dormer windows, has two bedrooms, in addition to the two bedrooms on the main floor. There is no basement. The main floor has original hardwood, except for the kitchen and bathroom.  Upstairs has all-new carpeting and has been freshly painted. The heated 2-car garage is in addition to a one-car garage in the backyard that a previous owner used to store his Model T. The seller uses if for storage. Take a narrated video tour at www.ArvadaHome.info, then call for a private showing.  Open Sat., May 18th, 3-5 p.m.

5-BR Littleton Ranch Has a Finished Basement

This 2,963-sq.-ft. brick ranch at 8006 S. Vance Court is in the Columbine Knolls South subdivision, north of Chatfield Ave. between Wadsworth & Pierce. It was just listed for $498,000.

It has four bedrooms and 2½ baths on the main floor, plus a 5th bedroom and 3/4 bath in the basement, along with a rec room and plenty of unfinished storage. It’s a super quiet location, as you’ll observe on the narrated video that you can view at www.ColumbineKnollsHome.info.  Some features that caught my attention include the three Solatubes and one skylight bringing natural light into the home’s interior spaces, including the kitchen, plus the beautiful family room with rock fireplace and vaulted ceiling. Watch that video tour, then call your agent or me for a private showing — or come to our open house this Saturday, May 18th, from 11 a.m. to 1 p.m.

Updated Golden Tri-Level Home Backs to Greenbelt

This 3-bedroom, 2½-bath home at 491 Somerset Drive is in the Lakota Hills subdivision, also known as Eagle Ridge. It was just listed for $638,000.

It sits on top of a ridge overlooking Rooney Gulch and offering unobstructed views of Lookout Mountain.  It has been beautifully updated with slab granite countertops, new stainless steel appliances, new carpeting and paint throughout. The sellers purchased it earlier this year, but personal developments make it necessary for them to sell it.  Their loss is your gain. Take a narrated video tour, including drone footage, at www.SouthGoldenHome.com, then ask for a private showing. I’ll be holding it open this coming Sunday, May 19th, from 11 a.m. to 1 p.m.  Or call me at 303-525-1851 for a private showing.