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Negotiating skills are an important tool in Real Estate. Here are a few strategies that you can add to your tool box.
There is a well known book called The Art of Negotiating. This book was my first exposure as a young business person to the idea that negotiating wasn’t a game of winners and losers, but of “win win” for all parties. The definition of negotiations from www.dictionary.com is “mutual discussion and arrangement of the terms of a transaction or agreement.” The key word in this definition is mutual; we get back to that “win win.” You might ask, “How can I get the best deal and still have the other person win?”
Find out what the needs of the other person are and try to meet those needs without losing sight of your own goals.
- Listen – number one rule. This is an interactive communication process and the key is listening. By listening you can find out the motivation, objective of the other party, build trust and create the lines of open communication. Being a good listener takes getting the other party to talk. You’ll need to ask open ended questions, test for understanding, listen actively, acknowledge what is being said and summarize what was discussed. This is active LISTENING.
- Motivation – What is the motivating factor behind the other party? Motivation is not often simple and may take a little digging either by you or your agent.
- Trust in your agent – If you hired a professional, they know how to get needed information and help you navigate through negotiations. It’s important that you trust them and know they have your best interest at heart. A professional agent isn’t short sighted and just looking for one deal. They are looking for a client for life and referrals.
- Run the numbers – You know I’m a stickler for this one. Information is power. Seeing the facts in black and white can help take the emotion out of this decision. Do the math and share the results.
- Take all factors into consideration – Money or price isn’t always the primary consideration. This is where, once again, good listening skills come into play.
- Keep clear what the overall objective is –and use it to keep negotiations on track.
- Don’t take things personally – Many years ago I read a book that changed my life, The Four Agreements by Don Miguel Ruiz – The second agreement in the book is “Don’t take anything personally.” Nothing others do is because of you. They are concerned with their reality. This is extremely powerful when negotiating. It allows you to stay calm and focused.
- Find consensus on what is important – This goes along with keeping clear the overall objective.
- Aim High – Leave room to negotiate but also be careful not to insult. If an offer is too low this can be considered insulting and can be difficult on your agent. Make a fair offer that leaves you that room to negotiate.
- Give and Take – If you give something, have a clear expectation that you expect something in return. The “give and take” doesn’t have to be of equal value. The equality is in the process.
- Have a plan “B” – negotiation is somewhat like a chess game, be several moves ahead so that you stay in control.
- Know when to close or move on – don’t be afraid to walk away. It might mean that you won’t get the deal, but it might also be the impetus the other party needs to reach agreement.
Negotiations are a delicate art that takes time, effort and experience to refine. Our staff of professional real estate investors can help you learn to invest in real estate and negotiate like a pro.
Diana Hill – firstname.lastname@example.org