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The Art of the Deal


In real estate negotiation is critical. Whether you are buying or selling, this is one of the most important aspects. This is my favorite part of this business. I grew up in a family of cow traders, there was always someone wanting to trade on something. So negation has always come natural to me. I hope these few tips will help you out next time in your real estate deal.

The first thing to do is find out something about the buyer or seller. This will give you a little leverage. One of my first questions is why do you want to sell and how long have they been trying to sell. If you can find out these two questions this can help tell you how motivated they are. Also it helps to know if there has been any other offers on the place. Most of the time the first offer is going to be the best. I do not know why this is but this is normally the case. I am not saying always take the first offer, but in this market you do not know when another one is going to come around.

Next, find out what the average selling price in that neighborhood is. Get your real estate agent to do a competitive market analysis for this neighborhood. This information will give you an “average: price per square foot that other similar houses are selling for. This will tell you approximately what the place is worth without getting an appraisal. You are always trying to get as much leverage as possible. The more you can find out about the sellers needs, the better chance you have to find solutions to negotiations hurdles thrown at you.

Buyers ask all the time how much under asking price they should offer? There is not a standard percentage that you should always offer. It goes back to the market analysis and what the average house is selling for in that neighborhood. A buyer does not want to come in and lowball the seller. This puts the seller on the defensive and they will be hard to get along with.

It is best to approach negotiation with the right attitude. It takes the pressure off both parties. You want create a win-win situation for both parties. If one party is only looking out for themselves a resolution will be difficult to find. If the other party knows that you are trying to come to a good solution (terms both of you can agree on), they are motivated to try to reach a deal also.

Negotiation takes patience. This is a very stressful situation for both buyer and seller because your emotions get involved. This process is also time consuming. Most of the time, it takes longer than you expect. Try to change your expectations about time. Also consider what the other person is going through. That will usually result in your having more realistic expectations.

Know when to walk away. Sometimes things just do not work. If you are the buyer, things are much more difficult if you are emotionally invested in the decision. Back off until you can see the issues clearly. This is hard to do. Sometimes I think that I have got to have something. I have never gotten a good deal when I feel like I have to have it. I lose my objectivity. I hope these few thing will help you. Untill next time… may God Bless you.

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