There’s no doubt 2020 has been a challenging year. A global pandemic coupled with an economic recession has caused heartache for many. However, it has also prompted more Americans to
Here are 5 Negotiation Tactics You Should Avoid
Dated: November 3 2020
Negotiation is a subtle art in real estate, but skilled negotiators can usually find some common ground that satisfies all parties. On the other hand, using the wrong negotiation tactics can sink a deal pretty quickly. If you are hiring a Real Estate Agent to negotiate on your behalf, it's important to understand what works in today's market... and what to avoid! Here is a list of 5 Bad Negotiation Tactics that can sink your deal:
1. Lowball offers: Going far below market value when you make an offer damages your credibility as a buyer and can be insulting to the seller. This is especially true in today's Seller's Market. The seller has priced their home with a range in mind that they’ll accept, and if you’re not even approaching the low end of that range, often they won’t even consider the offer. Particularly when a listing is "Fresh" (less than 30 days on market), trying to low-ball a seller is generally regarded as a waste of time.
2. Incremental negotiations: Don’t continue to go back to the seller with small increases in your offer ($1,000 or less). The constant back-and-forth can grow tiresome and lead the seller to consider other opportunities. If "Meeting In The Middle" of your price gap isn't palatable to you, then it's probably best to move on.
3. “Take it or leave it”: It is not advisable to draw a line in the sand with your initial offer. The seller could get defensive and consider other offers if you immediately show that you’re unwilling to budge. After your offer is reviewed, look objectively at the Counter-offer that is returned to you. Is the seller moving in your direction? The first clue you will have in your negotiations is how much the seller moves in the counter-offer.
4. Nitpicking after inspection: Obviously if the inspection reveals a major issue, it should be factored into the final sale price. This post-inspection renegotiation is critical, and some deals fall apart here. Insisting on a lower price for every minor repair can put negotiations can kill the deal.
5. Asking for more, more, more: Some buyers will request that the sellers throw in add-ons like furniture or appliances that weren’t included in the listing. Try to avoid giving the seller a reason to build up resentment and think that you’re being greedy.
BOTTOM LINE: Negotiations only work when both parties believe they "win". If one side gets takes and takes, and the other side doesn't, it often will fall apart. Both parties should be seeking a "Win-Win". Understanding the other party's objectives is key to getting the deal done!
Buying or Selling a Home in Today's Market is a complicated process. Mike brings 35+ years of Real Estate experience to the table, as both an investor and a Licensed Broker. In 2020, Mike co-founded....
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