Essential advice for negotiating success

Real estate agents understand better than most that the act of negotiating is inherently risky and rife with difficulty. Everyday agents act as the communicator between buyers and sellers who lay their chips down on the bargaining table, and often parties have inflexible briefs and/or budgets, rendering it challenging at times to strike a satisfying balance. While acting too passively may fail to achieve a particular price, pushing too hard can just as easily stifle the process.

The below points may assist next time you find yourself negotiating:

Do your homework: There is no substitute for preparation and organisation. Conducting research into the issues, people and context which form the overall negotiating situation will provide you with the best possible information advantage from which to begin facing your opponent. For example when negotiating with a seller, it may be helpful to research the properties they’ve sold in the past, the price at which they’ve been sold and the time spent on the market. In this way you’ll better understand if you’re up against someone adept at moving their property quickly, and adapt your strategy accordingly, or if it is someone who will be more willing to compromise in your favour.

Start high: Beginning a negotiating process from a position of strength can provide plenty of rudders on the ladder for opposing parties to move between. When acting for a buyer this will obviously mean suggesting a lower price than what they may eventually be willing to buy for, and so it may be helpful to build a common understanding about what this price might be prior to entering the negotiating table by discussing their final budget and conditions. As an example, they may have sold their house prior to buying and are therefore under a strict six-week settlement yet have reasonable purchasing power.

Understand the process: Negotiation is a progressive practice and it is more than likely that you won’t achieve the desired result using the same negotiating tactic every time. Compromises may have to be made, and as an agent it’s important to know when to forgo unlikely terms and when to settle. For instance, if you ‘ve played boomerang with a potential buyer for some time and have finally secured a decent sale price on the condition of a longer settlement, it would be ideal to underline to your seller that this is a ‘win, win’ situation and a good deal, considering the circumstances.

Posted by Reality Bytes - Real Estate Training Blog on 29/10/2014 at 12:00 AM | Categories:

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