Declining Sales Aren't Pushing Home Prices Downward, but You Can Use These 3 Tactics to Negotiate

Mortgage lenders are no longer offering the attractive borrowing rates home buyers had access to in 2020 and 2021. Quite the opposite -- as of early August, the average 30-year mortgage rate was 6.96%, according to Freddie Mac.

It's largely because of higher mortgage rates that buyers have been retreating from the housing market. And in June, existing-home sales were down almost 19% on an annual basis, according to the National Association of Realtors.

But frustratingly enough, a decline in home sales hasn't done much to bring property values down. The median sale price for existing homes in June was $410,200. And that's the second-highest price recorded since January 1999, when this data first started getting tracked.

If you're looking to buy a home, you may not get much of a discount despite cooling demand. But you can use these tactics to try to negotiate a lower purchase price with your seller.

1. Highlight the flaws

No home is perfect. But expressing concern about the home you're looking to buy might result in your seller coming down on price.

Let's say the appliances are outdated, and the backyard deck looks like it's seen better days. Highlighting those flaws and explaining how they add to your financial risk might get your seller to lower their asking price. And if not, they might at least agree to make some changes as part of your purchase agreement so that you are less likely to have to sink money into the home once you take ownership.

2. Offer to pay cash

Buying a home in cash may not be possible financially for you. But if you have the money to purchase a home without a mortgage, then doing so might benefit you in a couple of ways.

First, today's mortgage rates are quite high, so if you don't need a loan, you may want to avoid one altogether. Secondly, sellers take on less risk when they work with cash buyers compared to those who need financing.

If someone sells to a buyer who needs a mortgage and their home loan falls through, that seller has to start over again. And so if you're able to pay cash, thereby lowering your seller's risk, you may be rewarded in the form of a lower purchase price.

3. Be flexible with your closing date

Many people who buy homes want to close as quickly as possible so they can get settled. But your seller may need some flexibility.

Maybe they're moving for a job that won't start until October, so they don't want to close just yet. The more flexible you're willing to be with your closing date, the more willing a seller might be to lower their price.

You'd think that declining home sales would be leading to lower prices. But alas, it seems that buyers can't catch a break no matter what. These moves, however, could help shave some money off the cost of your home, making it more affordable at a time when residential real estate is anything but.