One of the most important things a real estate agent brings to the table is their negotiation skills. This is at the core of their being, right next to their endless depths of real estate marketing knowledge. If a buyers’ agent can’t negotiate the best possible price, then they aren’t earning their pay. While most Brisbane buyers agents understand the principles of negotiation, not all know the best tactics that win out in the end. Here are our top six expert negotiation tactics and how to execute them effectively.
1. Understand The Need For Give And Take
Negotiation is all about getting what your buyers need and as much as what they want as possible. Since both sides are trying to do the same thing, it can be difficult to master coming out on the winning side. Knowing you can’t get everything you want, be certain you always know what you need so you can sacrifice some wants and come out looking like a hero. When you can show the sellers you are willing to give in to some of their needs, without showing it is actually easy for you to do, you can then hopefully get them to cave on the most important things to you. Create a list of things that don’t cost you much to give, and exchange them for more valuable wins you can receive.
2. Know Fair Market Value
The truth of the matter is, when it comes to real estate negotiations pricing is looked at in two ways:
- Sellers: When selling a home people tend to look at the most flattering and inflated prices, even if those prices aren’t so recent. An overpriced market a few years ago therefore will be what they depend on, or whatever price seems to be the highest, recent or not.
- Buyers: Of course buyers want to pay as little as possible, yet know they can’t just make a lowball offer. The only way to come in at a fair price is to look at comparable recent transactions. The going average price, give or take a few tens of thousands is what they are willing to offer.
The trick, therefore, is not just knowing typical house prices in an area. Instead, you need to know the higher end and why some houses sold at that price, and the lower end and what brought those prices down. You can then compare the house in question to see where it sits realistically and come with comps in hand to ensure you are offering the most suitable offer based on current market prices. Instead of lowballing, you start at a price that actually makes sense based on facts.
3. Use Affirming Language
During negotiations, each side fears being taken advantage of by the other. Because of this, it’s important to present each point in a manner that allows the seller to feel they are in control. When you add affirming language that leads them to believe they are actually taking advantage of you, they are more likely to agree. When presenting your requests, adding simple intros such as “This is probably not possible, but…” or “I understand if you refuse this one, however…” or even “My client is being a little unreasonable with this one, but maybe it works for you…” often makes it easier for the other side to comply. Because you’ve set it up as something very negative, when they hear the request, they will see it really isn’t so bad.
4. Use a Win/Win Approach
Smearing your face with blue paint and making it clear you’re ready for battle is the worst possible negotiation tactic. The saying, “you attract more ants with honey” is true in just about any situation where you want something. When you try to come up with ways to create win/win situations in the negotiation process, agents are more likely to want to work with you. Agents resent aggression and will automatically be on the defensive even for the simplest requests. If you approach them with a “let’s do this fairly” attitude, they will see you want to make things work for everyone.
The result is they usually see a path of least resistance and take it happily. Should an issue present itself, instead of immediately stressing the negatives of the situation, you instead start offering solutions. Using language like “What if we were to do this instead, would that work for you?” as opposed to “Well that is not going to work and we aren’t willing to do it that way!” instantly shows the other team you see the issue, but want to resolve it instead of making it worse. You can also find out more about the sellers’ needs to look for unseen opportunities that provide you with further negotiating leverage. This way you have something in your back pocket the sellers’ agent didn’t know was possible.
5. The Art Of Persuasion
Persuasion is a key talent when it comes to negotiations. When you understand the basics of persuasion, you can sell a bottle of sand to a man dying of thirst in the desert. So what are the “rudiments” of persuasion:
- Reciprocity: When you offer something to someone, they feel obliged to give back.
- Scarcity: If you convince someone something is rare, they feel an urgency to act.
- Authority: Presenting those comps shows your expertise which makes it difficult for a seller to deny your fair price.
- Consistency: Making people feel comfortable in your presence creates a feeling of constant security. This makes it easier for them to stop seeing you as an enemy.
- Liking: Finding common ground that makes you seem similar to each other creates a positive attitude, so people find it easier to agree with you.
- Consensus: By always presenting yourself as a fair and amiable negotiator, more people will want to work with you. This works in your favour as being liked is an excellent negotiation tool.
6. Honesty, Honesty and Honesty
While location, location and location are the three most important features of a property, honesty to the power of three is the most important aspect of negotiation. Although some of these tips might sound a little underhanded, as long as you remain honest, you can negotiate in good faith. If the sellers’ agent senses you are lying, all hope is lost. When it comes to finding the best buyers agent in Brisbane, Contact Locate Buyers Agency today!
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