Negotiating – It’s A Piece Of Cake

Why are people so scared of the word NEGOTIATE? When selling privately or even when using an agent, you are negotiating a lot of the time without even realising it; Negotiating – It’s really a piece of cake, and a very tasty one if handled the right way.

So why when we mention this term do our customers, tense up, get all hot under the collar and envisage a high pressure scenario. When we change our terminology and use the word, talk, discuss, confer, collaborate or even powwow, they don’t seem so intimidated. Why? They all imply the same thing. Simply put, it’s just a discussion between two parties.

The thought of negotiating for anyone selling their own home shouldn’t create discomfort. It should be viewed as a tool to reach a mutually beneficial arrangement. In terms of a real estate transaction, this would be when the seller is happy with the amount they are receiving for their property and the buyer is satisfied with the amount they are paying for the property. They both see value in the deal.

It’s suggested you leave your ego at the door. Negotiating is not about winning every point. It’s about making it a win-win situation for all involved, which ensures a quick sale and a happy ending.

Negotiating the sale of your property is no different to negotiating the sale of your car. Granted, you’re playing with much larger numbers, however the approach is still the same and so are the techniques you use. Remember, just because you are in discussions with someone, does not mean you have to keep talking until you reach an agreement. If you don’t think the other person can come to the party and pay what you are asking, then you can walk away. You always have that power. In a deadlock situation, always be the first to walk away. Never be desperate with your approach to negotiating a sale price on your property as a buyer will sense this and you will never achieve the price you are after.

We provide the following tips to our private sellers. We encourage them to approach the negotiation of their property from a place of deliberateness not desperation.

How to successfully negotiate when selling privately

1. Both parties must recognise they have a common problem and share an interest in solving it. One party has something to sell and the other party is looking for something to buy.
2. In the early stages both parties must determine their goals. As a seller and buyer you want to have some firm numbers in mind. For a seller, what is your dream price, what is a fair price and what is the lowest price you will accept. For a buyer, it’s simply the reverse, what would be the ideal price you could secure it for, what do you consider to be a fair price and what is the absolute most your will pay. Knowing these numbers allows you to approach the negotiation without letting emotion cloud your judgement.
3. Be prepared to go back and forth a number of times before you reach a mutually beneficial agreement. As a seller, if you don’t have a set figure placed on your property, don’t be the first to name your price, you may be selling yourself short, who knows what your prospective buyer is willing to pay. Let them give you their number first!
4. Negotiating the sale price of a property isn’t only about a dollar figure. Typically negotiation involves more than one issue. There are a number of other terms you can negotiate on and these may be used as leverage to secure a more advantageous outcome. An example of this would be if a buyer would like an extended settlement you may be able to use this request as a means of securing a higher price. Alternatively if you need to settle quickly, you may be willing to accept a reduced offer to achieve your objective. As outlined in point two, you must know what you want and what you’re willing to accept from the outset.
5. Know your facts. If you are asking for a certain price for your property, make sure you have the facts to support why they need to pay that amount. Know your market. Know your homes features and what separates it from other similar properties. If there is nothing out there like it, use scarcity as a way of assisting you achieve a higher price.
6. Finally assess the other parties priorities. Try and get to know the seller and what their motivation is for securing the property.

Remember a negotiation can be a sprint or a marathon. You may reach a mutually acceptable arrangement very early on in your discussions, or it may go back and forth for some time before you can both agree on a set figure and agreeable terms. Whatever you do, don’t lose sight of what your initial goal was and always be open minded and flexible. Rigidity will not serve you well in a negotiation scenario.

Negotiating is not something to be afraid of. It should simply be viewed as entering into a discussion with the aim of achieving a win-win result where both parties walk away happy. This is the optimal outcome, especially regarding a real estate transaction, as it will ensure the remainder of your dealings run smoothly, to schedule, and without impediment.