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Introduction
Negotiation , unfortunately , is not taught much to real estate professionals , or to investors . International , corporate , and purchasing courses exist , even to the extent of Master ’ s degrees , but real estate has not received the same coverage . This article aims to help that .
Start Out Early
The Three Elements
There are three elements to any negotiation : 1 ) Information , 2 ) Time , and 3 ) Power . These will be described below .
Gather Information
The negotiator who gathers the most information usually has an advantage . Interview people , obtain reports , do inspections , use the MLS ( MultipleListing Service ) and other online resources . Hire a private investigator on the seller if the deal is large enough , looking for vulnerabilities ( e . g ., bitter divorce ). You can ’ t know too much .
The Factor Of Time
It helps to know if the other party has any time constraints , along with your own , of course . Pending foreclosure , divorce , condemnation proceedings are some examples . If the property is “ a steal ”, scoop it up fast . If it ’ s priced at or above “ market ”, then “ grind real slow ”. Use time to your advantage .
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The Factor of Power
In some negotiations the power levels are uneven . One party has more leverage over the other . Seasoned negotiators assess power levels and devise strategies to take these into account . Then , even the weaker party can optimize its outcome .
Be Generous When Selling
Some sellers believe in “ WinLose ” negotiating . They want “ top dollah ”. This apparent greed and intransigence grates on everyone involved , sometimes to the extent of legal action or retaliation . Be generous when selling . Paint that bedroom . Purchase a Home Protection Plan for those firsttime buyers . You ’ re on your way to wealth . Don ’ t be cheap !
Keep Your Word / Perform And Smile
Keep your word . Perform everything you ’ ve agreed to do . And smile as you do it , even if the deal is going against you and you are taking a loss . Don ’ t whine . Smile . Builds character …. and your reputation .
Negotiations begin at the first encounter ( e . g ., phone inquiry ). Many people think the initial pleasantries are just that , and the formal negotiations will begin later . Not so . The superior negotiator will have already begun gathering information and setting expectations . Start early so you don ’ t have to catch up .
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