Property Negotation 101

All homebuyers want the best deal that they can possibly get, while all sellers want to sell their property for the best possible value. There are a few things that we believe distinctly separate good negotiators from bad ones.

 

  • Many people believe that you must be a ruthless competitor in order to negotiate well, that you must make yours terms clear and present it as a take it or leave it, and you must do it with aggression. In our experience, this is in fact more counterproductive than is widely believed. Aside from the money and terms of the agreement, the relationship aspect is important for negotiation, so it is wise to establish rapport with the party you are negotiating with and show recognition for their position. No one likes to feel dominated during negotiation, and it often drives people away.
  • We recognize that their are some folks who just cant be reckoned with, and who do have that strong personality in which it seems like a deal can never be made. While keeping in mind the tip above to be courteous and considerate of the other sides wants and needs, we have found the old “mirror and match” sales phrase effective when negotiating or communicating with anyone, if you are negotiating with a hard headed individual, you may have to step into character yourself while maintaining composure so as not to blow the deal. People often times have the easiest communication with people who talk or act like themselves, this tactic is very useful.
  • Time. Use time to your advantage, if you are lucky enough to not be competing against other purchasers or sellers you should take your time. The first reason is because usually things become tense during a negotiation, and you want to make sure that you issue a response to an offer with a clear head. As the buyer, you don’t want to seem to desperate, and as the seller, your property sitting on the open market creates buyer urgency to get the deal done. Expect there to be some issues that arise during a negotiation, don’t run from them or try and jump down the other parties throat, take a step back, think over your options, and resume the negotiation. In Real Estate, you often have at least 24 hours to respond to an offer.
  • Keep in mind all of the things that you want out of the deal. The best price, the best terms, closing date, inspection, closing costs. With all the different factors that effect a real estate deal there are many concessions to be made. Perhaps it is more important to you to close quickly rather then obtain your price, if that is the case, then you should offer the buyer or seller “ok your price, but my terms, I need to close this as soon as possible”. Perhaps you may want the buyer to waive the property inspection, or maybe there is a piece of furniture in the sellers home that you would like, this is all subject to negotiation, and should be added by your attorney to the contract of sale.
  • Most people believe they will have to scream their terms at the other party and hang up on them or walk away from the conference table to really get their point across. In fact, we have seen successful negotiators as much more keen to listening rather then doing most of the talking. When the other party is talking, they reveal key information that you can use to your advantage. For instance, if it is revealed during your talk that the sellers must sell the property to purchase another home they have in contract, then it has become pretty apparent that these sellers are highly motivated, and must make a deal quickly. If this is the case, you can offer to expedite the closing as quickly as possible in return for a price reduction.

We hope these basic tips are helpful on your next property negotiation!

 

Frank Morris

Licensed Real Estate Salesperson

71 Pondfield Road

Bronxville NY 10708

914-500-9194

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