A matter of negotiation

Subject to negotiation - The phrase “subject to negotiation” (VHB or VB) in real estate listings indicates that the listed price is not a fixed price, but rather serves as a starting point for negotiation. The seller is thereby signaling a willingness to negotiate the purchase price. In practice, the VHB price typically allows for a negotiation margin of 5-15% - depending on market conditions, property characteristics, and the negotiating skills of the parties involved.

Implications for Buyers and Sellers

For the seller, the VHB designation offers flexibility: they can set the asking price slightly higher and have room for negotiation without having to sell below their actual minimum price. For the buyer, VHB is a signal that an offer below the asking price is expected-an offer at the full price is usually accepted immediately. In contrast, a fixed price (FP) signals that the seller will not accept negotiations, while highest bid indicates that the listed price is the minimum price in a bidding process.

The decision between “best offer” and fixed price is strategic: A “best offer” price set too high deters potential buyers, who won’t even inquire. A “price negotiable” price set too low signals pressure to sell and encourages aggressive negotiations. The optimal strategy depends on market conditions, the competitive landscape, and the seller’s personal willingness to negotiate. As experienced real estate agents, we help you choose the right asking price and the appropriate pricing designation.

Negotiation Strategy

Successful price negotiations are based on facts: an independent appraisal, a comparison with current sales prices of similar properties (not asking prices!), a list of defects and renovation needs, and knowledge of the time on the market. The longer a property is on the market, the greater the room for negotiation-after 3 months on the market, most sellers become significantly more willing to negotiate. Emotional arguments are less effective than factual justifications.

For buyers, the following applies: The first offer sets the benchmark for the entire negotiation. Those who start too low risk being perceived as an unserious buyer; those who start too high give away room for negotiation. A first offer of 5-8% below the “price upon agreement” has proven effective, combined with a factual justification (proven need for renovation, comparable transactions, long-term vacancy). In a multi-party competition (multiple interested parties), a higher initial offer is recommended to even make it onto the shortlist.

The Psychology of Price Negotiation

In addition to factual preparation, psychology plays a significant role in real estate negotiations. For sellers, their own property is often emotionally charged-decades of memories, renovations they’ve done themselves, and personal attachments lead to the subjectively perceived value exceeding the market value. Buyers, on the other hand, often experience “bid fatigue”: after weeks of searching, they become more willing to bid above their actual budget. Both effects can skew the negotiation.

Experienced real estate agents professionally manage these emotional dynamics. They create distance between the parties, provide objective market data as a common basis for discussion, and prevent negotiations from failing due to emotional misunderstandings. An agent who fairly represents both sides significantly increases the likelihood of reaching an agreement that both parties perceive as fair-and that holds up until the notary appointment without either party backing out.

It is also helpful for buyers to obtain a financing confirmation from the bank early on. Anyone who can credibly signal to the seller that financing is secured negotiates from a position of strength-because for the seller, the certainty that the purchase contract will actually be executed is often more valuable than a marginally higher price from a prospective buyer without a financing commitment.

Practical Tip for Property Owners in Nuremberg

We recommend that sellers in the Nuremberg metropolitan area carefully calculate the as-is premium. In a seller’s market (strong demand, limited supply)-as is currently the case in Erlenstegen, Johannis, and am Tiergarten-a premium of 3-5% above the realistic market value is sufficient. In a balanced market, you should plan for 5-10%. Excessively high premiums deter prospective buyers and lead to long marketing times.

We recommend that buyers submit their first offer 5-10% below the “best offer” price and support their negotiation with objective reasoning (need for renovation, comparable prices). As real estate agents, we facilitate negotiations professionally and impartially-so that both sides reach an outcome they consider fair. This increases the likelihood that the transaction will hold until the notary appointment.

Frequently Asked Questions

How much room for negotiation is typical with “price negotiable”?

In the Nuremberg metropolitan area, the average room for negotiation is 5-10% of the asking price. For highly sought-after properties in prime locations, it can be close to zero-in these cases, properties are often sold for even more than the asking price. For properties with defects, a long time on the market, or in less sought-after locations, the leeway can be 10-15% or more. Basic rule: The shorter the time on the market and the more interested parties, the smaller the leeway.

As a seller, should I list “price negotiable” or a fixed price?

Price negotiable is the better strategy in most cases: You reach more interested buyers and retain room for negotiation. A fixed price makes sense for properties in very high demand or in forced sales where a minimum price must be achieved. In practice, approximately 80% of all private sellers in Nuremberg use the “price negotiable” (VHB) clause.

How do I conduct price negotiations professionally?

Prepare with facts: current comparable prices (appraisal committee, market reports), cost estimates for necessary renovations, energy performance certificate data. State your initial offer with a rationale-don’t just name a lower price. Show the seller that you are a serious buyer (present proof of financing). Negotiate fairly but firmly. An experienced real estate agent can moderate the negotiation as a neutral mediator and achieve a good outcome for both sides.

What is the difference between a VHB and a bidding process?

In the VHB process, the seller sets a starting price and signals a willingness to negotiate downward. In a bidding process, on the other hand, often only a minimum price-or no price at all-is specified; interested buyers submit their own bids, and the seller selects the best offer. The bidding process generates stronger competition among buyers and can lead to prices significantly above market value for particularly sought-after properties. In Nuremberg, the bidding process is primarily used for multi-family homes and highly sought-after condominiums when the real estate agent knows there is high demand from the list of interested parties.

Back to the Real Estate Glossary.