When it comes to negotiations in real estate, one thing is always at the forefront: Price.
The seller wants the highest price possible, while the buyer wants the lowest price. The best Realtors fight for their clients, making sure they leave the table satisfied.
Your ability to close a deal and make your clients happy defines your perception as a real estate agent, whether you’re a listing or a buyer’s agent.
The art of negotiating doesn’t always come naturally, so don’t beat yourself up if you don’t have what it takes just yet. This is something you can practice and improve if you’re willing to try.
You can learn how to use different negotiation techniques by reading books or even taking online courses. But the best approach is to learn the skills you need to be a good negotiator and practice using them in your business.
So what does it take to close a deal? Check out the video below, and read on for more helpful tips to step up your game.
1. Don’t be afraid to ask for what you want.
A real estate agent on top of his or her game is assertive and will not accept the first offer, unless that offer is in the client's best interest (and hopefully over the asking price). Top agents understand that every offer can be negotiated. They know how to ask for what they want and negotiate until they achieve the best result.
Good negotiators aren't aggressive, but assertive. They know how to negotiate for what they want without coming off as confrontational or arrogant.
Learn how to ask for what you want without being disrespectful to the other party.
Many of us love to hear ourselves talk, so we hardly listen to what others have to say. Communication is very important in any negotiation process. Communication allows two parties to reach a compromise.
A good negotiator will ask probing questions, then listen. Practice listening, and the other party might just tell you all you need to know, giving you the power to beat them.
To practice active listening, try to mirror the other party. Repeat a few words said to you. This builds rapport and acknowledges that you’re listening.
The other party will feel comfortable to keep negotiating and even accommodate what you have to say.
3. Be prepared.
Never go to the negotiating table unprepared. Do your homework before you put forward any offer.
Understand the needs of your clients so you’re able to meet them. Explore all options available to your clients. This way, you'll know what to ask for and how to negotiate to get it.
Before you start any negotiations, think of all the possible proposals and objections the other side is likely put forth. Think about how you'd counter these responses, so you'll be prepared when you actually have to face them.
Don't be caught off guard, and you'll be prepared for anything that comes your way.
Doing your research is important if you want to succeed in negotiations. You'll be in a better position to negotiate if you are fully aware of what is fair for your clients in any given situation.
For example, if you're working as a buyer's agent, you'll want to know the fair market value of the home your clients want and keep that number in mind while you're negotiating. Don't let unrealistic sellers force your clients to concede on an overpriced home.
The more you know about the other party, the higher your chances of beating them at their own game. So do your homework on their situation — find out why they're selling, if possible, and how motivated they might be to sell.
Likewise, listing agents should find out how motivated buyers are to get into the home — perhaps they're living with in-laws, or their current apartment lease is about to end.
4. Show the other party how their needs will be met.
People are more likely to listen to you if they genuinely feel you have their best interests at heart. They'll let their guards down if they feel that their needs are being addressed.
A great negotiator will always view the situation from the other party’s perspective. Reverse the roles and put yourself in the other person's shoes. What would your needs be, and how would you like them to be addressed?
Base negotiations on your results, and you'll start thinking differently and achieve better results for your clients.
If you’re negotiating on behalf of a seller, understand why the buyer wants to buy a home and exactly what they consider a dream home. Then, show them why your client’s house is exactly what they want and therefore, absolutely worth the list price (or more!).
Make it about the buyer and not your client (the seller). Let the other party feel they stand to gain more if the deal goes your way. This will force them to be on your side for a moment, and if you take advantage of that moment, you'll have the optimum chance to make the deal go your way.
5. Always be willing to walk away.
The best real estate advice anyone will ever give you is to know when to walk away from the negotiating table.
Often, people want to continue pushing even when things clearly aren't going their way. This makes you come off as desperate, and you lose your ability to say no to the deal.
When you let the other party know you're willing to walk away, they know you mean business and will take you more seriously. They will not try to push you over.
Assert Your Authority!
As a real estate agent, you'll spend most of your time negotiating for something. Your success depends on your ability to negotiate. By employing the above strategies, you gain a competitive edge in any negotiation process.
Being a great closer can make you more desirable to work with, but you know what else does that?
Becoming the ultimate authority in your market. You can do that with our MyBooks program.
Books give you instant credibility. They make you an authority in your industry. They make people take you seriously.
Books hold inherent value, and people appreciate receiving them. They may not read them immediately, but they won’t throw them away, either. They'll always remember that you’re the Realtor who gave them a book.
For that reason, they'll want to know more about you and even want to do business with you.
Want a free sample of the book that will get you more listings? Click the link below.
Joe Nickelson is a real estate professional dedicated to helping home buyers and sellers achieve their dreams of owning property, and helping real estate agents stop using the sometimes-vicious tactics that weigh on their consciences. He believes that the Smart Agents books will, quite literally, change people’s lives for the better. Check out his full bio here!