This is highly dependent on item and situation. In a seller's market, you may be shut out by other buyers. Before the subprime mortgage crisis cooled down the SF Bay Area real estate market, there was no way you could haggle down 15%.

Heck, I sold my last car on Craigslist at the Kelly Blue Book private party sale price. I had two very serious buyers: one wanted to haggle, one said my asking price was fair. Guess who won?

Deprong Mori

It also depends on the negotiation style of the parties involved. One person might give away far to much information, directly or indirectly, to the point where the other party is at an advantage. Low-balling will no longer matter at that point.

jonny6pak

Heck, even in today's cooled down real estate market, I don't think you can haggle anyone down 15%. Recent listings already reflect the drop in the market, and there's no way you can tack on another 15% discount from the asking price.

Deprong Mori

Depends on the seller. Some salespeople can size up a buyer in seconds and set the margin accordingly, so a product that the salesperson would sell at $1000 is jacked up to $1200 right off the bat, so using this "static" negotiating technique still leaves you screwed in the end.

I say, know the market for the product you want, and don't get played like a sucka'.

TendoMentis

You can't know what concessions the other party will give you until you start asking. Maybe there's a sales contest that you don't know about. Maybe he thinks he's not offering quite the product that you asked for and is willing to drop the price to entice you (you asked for low mileage with new tires and brakes). Maybe making a fast sale is more important than price (they need the space). Maybe making a sale next week is more important than price (sales contest hasn't started yet). Maybe they are hugely overstocked on a closeout and willing to drop the price (like housing). Maybe the item has gone out of style (low gas mileage).

dchall8

I am not sure that about 15%, but you will never get anything unless you ask. First, ask questions about the product. This get's the salesperson thinking you are going to buy. People who are not interested don't ask questions. Ask questions like "How much is delivery for this item?" Unless they say "Free!", immediately tell them it's too much.

Ask more questions. If at a store, ask them if they have periodic sales throughout the year because you just don't have as much as they are asking. Tell them you will buy it today if they can make you a deal. Suggest a number. If they take it, then remind them that you would need Free delivery.

Be prepared to walk if pressed on the extra cost. Remember, they are in sales and have a quota to hit. They see a buyer slipping through their hands. The larger the commission, the larger the desire to make the deal on their part.

gabegrote

If you lowball a real estate offer, you may not even get countered. As a buyer, you are not automatically entitled to haggling.

At least here in Cali, the buyer's offer expires after a certain time: the seller doesn't need to turn it down outright, nor give an explanation as to why.

You don't even get kicked to the curb. You are left standing in the street with your offer.

BarneyRubble

I always tell the sales person that it's un-American to not give me a good price and that if he doesn't give it to me for X dollars he's only helping the terrorists. This usually works or at least gets a chuckle and I often find that taking the persons mind off the actual transaction increases your odds that you'll get what you want.

dahlberg123

@Deprong Mori: Some real estate is priced near market value, if the seller has a good realtor and if they took the realtor's advice.

I still see lots of property listed at either what they owe or what they need to get out of it, which really has nothing to do with what it's worth. And sometimes the owners are so oblivious to this fact that they won't negotiate - time to walk away.

Bottom-line: As a potential buyer, always know what something's really worth going in to the negotiation - otherwise, how do you know if you're getting a deal?

bobbo33

@heavylee-again: I've asked for and gotten concessions...

heavylee-again

Bargaining can work in a large number of situations. For example, until recently I was a Comcast cable customer and I would call them every 6 months and explain that I wasn't comfortable paying full price for their services, and I would ask to be put on a promotion. When it would expire, I'd call them again. Each time, being polite, persistent and calm.

I've asked for and gotten cocessions with my pest control service, my cell phone carrier, and XM radio - all examples within the past month or two.

heavylee-again

Make sure your 15-20% less is fair! For example, I can currently afford zero to spend on a new car. 15% less than zero is zero. Who wants to sell a car for zero?

This is an extreme case, but if you can afford 6000, don't go bidding 5150 on a car worth 15K, ok?

englishman

@Deprong Mori: It depends on how desperate the sellers are to get rid of the house. I can also assume they're asking 10-15% more than they expect to get, knowing they're going to get haggled down. Cars are the same way.

HurtsSoGood

My dad's a pro at this. He knows the real cost (wholesale) of an item before he goes in. We were suit shopping once and he asked for 50% of the asking price. The salesperson kept lowering the price until they were at 60% the original price. Then, we threatened to walk and we got what we wanted. I couldn't believe it. We bought some other shirts and ties too.

A3sthetix

cash, my friend, is truly king.

Those with the means, have the world at their disposal.

Parapraxis

Yard sales are a great place to learn and improve your ability to haggle with someone. Walk up to one and challenge yourself. If you see something that's $10.00, see if they'll take $5 and expect a counter of $7 or $8. Look at it a bit more and put it down. They'll usually come down another buck or two just to get rid of it. I consistently buy things at half of what the seller is asking. If I'm buying more than one item, definitely go for the jugular and offer 40% of what they're asking for the three items together.

I'm not saying you can do this with real estate or cars but, why not give it a shot. You need to be comfortable with making an offer and be ready to walk away.

Some other tricks I've used is to hide my cash in different pockets and pull out $6.00 and say "That's all I have." The presence of the actual cash is usually stimulus enough to get the seller to hand it over.

There are tons of tactics you can learn and/or refine and not spend a lot of money by hitting yard sales.

If all else fails, come back the next day and see if they still have it, then go in for the kill with an even lower offer. Or, stop by later that evening and see it sitting out on the "Free to a good home" pile.

Money talks, Bullpoop walks.

kl0an

@BarneyRubble: Of course you're entitled to haggle; you're just not entitled to have the other person be interested.

In the case you mentioned, that's only a problem if I'm particularly attached to the specific property in question. Right now, I'm looking for a home to buy (probably a duplex), and I have several on my list. I have no problem walking away if a seller's not interested in negotiating with me, and I'll go on to the next one down.

chrylis

i tried this when i was buying my home years ago. my agent thought i was crazy, but i heard about that 20% rule and gave it a shot.

everyone was shocked when the offer was accepted without much of a fight. i'm still surprised that it worked.

helsers