I know what you’re thinking when it comes to negotiating real estate:
I Want A Great Deal!
I Want A Win/Win Situation
I’m A Reasonable Person
But in reality, when I work with sellers and buyers, their actions show more like:
Take This Lowball!
I Want A Win/Lose Deal, I Win, You Lose!
My Price Isn’t Overpriced, It’s Reasonable!
The problem is, most buyers and sellers think they are reasonable, but when they stand in the position of the other party, they’d probably think differently.
Buying or selling real estate is often an emotional process for people and that’s why Realtors are there to offer an unbiased opinion on the situation. I am often able to see both sides of the equation through my interaction with my client and the other party. I educate and advise, and then it’s up to my clients to decide how they want to proceed. Sometimes they listen to me, sometimes they don’t.
The #1 one thing I thing I tell my clients to watch out for real estate negotiations is to not piss off the other party. If I’m representing a buyer, if there’s not much competition, sometimes I would advise to write a low offer, but not something so low that would piss off the seller. If you start a negotiation by pissing off the other party, it’s hard to recover from it. You want to offer a number that’s low but it’s something that the seller can understandably work with.
How do I know what # that is?
I would tell my buyers to put themselves in the seller’s shoes. If you were the seller, what kind of offer for your property would be considered low but not too low that you’d rip up or ignore the offer? Usually when I ask that, my buyers would come up with the number.
The same goes if I’m representing the seller, if we get an offer, I’d advise my clients to try to counter and respond to the buyer. By ignoring the buyer, it may send the wrong signals and the buyer may just walk away. Of if the seller wanted to counter at full price or a price higher than asking, that may also send the wrong signals. When I represent my sellers, it’s key to have constant communication with buying agents or potential buyers of the property. Terms and price on offers and the intention behind them can easily be misinterpreted.
Whether working with buyers or sellers, often, just picking up the phone to dig up some more information is all that is required.
For more information, feel free to email or call me.