- In determining exactly what another party wants, you give yourself the best odds of negotiating a successful deal on everyone’s behalf.
- Asking for permission throughout negotiations is a great way to build rapport.
- Setting expectations, both on a conscious level and sub-conscious level, can be one of the most effective ways to positively impact a negotiation.
Is it possible to boost your real estate negotiation skills? What about if you’re terminally shy and worried about making all the real estate negotiation mistakes in the book?
Yes, it is possible to hone your real estate negotiation tactics and become, if not a superior negotiator, a force to be reckoned with when it comes negotiation in real estate. And all it requires is a few, simple shifts in both thought and action.
In this article, we will cover some real estate negotiation tips you can use to boost your real estate negotiation skills and help you become more artful and successful through all levels of your real estate business.
How To Improve Your Real Estate Negotiation Skills
1. Research, Research, Research
If there’s one element of the psychology of real estate negotiation that you must master, it is the art of research, planning and preparation. Just as you would not attempt to replace an engine in a car without the proper tools, you should not enter into any negotiation without knowing as much as you can.
For example, if you were dealing with sellers, you’d want to know more than a few things: Where is the property located? Who’s selling the property? Is the seller living on the premises? Why are they selling? When do they want to sell by? Have they had any other offers?
What if you’re meeting with an investor? What sort of return are they looking for? How quickly do they need that return? What investments have they tried in the past? What’s most important to them?
When you know where the other party wants the negotiations to go, it becomes a lot easier to get there.
2. Ask for Permission
This may sound strange, but one of the most powerful real estate negotiation strategies around is the power of asking for permission, before you do something.
This can be as simple as asking for permission to walk somebody through the process of selling a home to a real estate investor. (“Is it alright if I go over how this whole process works?”)
Or, it can be as delicate as explaining to a seller why their astronomical sale price is unrealistic. (“Is it okay if I share with you why that price might not help you reach your goal of selling your house in six weeks?”) Even bad news can be sweetened, ever so slightly, by asking permission, first.
Asking for permission doesn’t have to be relegated to simply the “nuts-and-bolts” part of the negotiation process. For instance, “asking” could be used when you ask for permission to sit down in their home. Or, when look at a book on a contractor’s bookshelf. Or, when you admire a painting in the home of a private lender.
Remember that the negotiation doesn’t just start when the numbers come out. The other party is gathering information about you the whole time. By continually asking for this permission, you’ll be creating genuine rapport that you can utilize throughout the negotiation.
3. Create Expectations
The ability to create expectations in a real estate negotiation operates on two levels: the conscious and sub-conscious. On a conscious level, there’s no question that you want to set expectations with another party about what the negotiation will entail, and how long it will take. (“First, we’ll go over what happens when a buyer is interested in your home. I’ll show you examples of what offers for this type of property look like. And then I’ll answer any questions you might have.”)
However, there is a more powerful feature to use when setting expectations, and that is on the sub-conscious level. Expert negotiators realize that the human brain is very powerful, and that it’s constantly looking for patterns. When you set clear expectations about what’s going to happen, and you tie that into an emotional state that you want the other party to be in, the chance of that expectation actually happening increase dramatically.
For example, instead of saying “let’s talk about the selling process,” you could set clear expectations about how you want the other party to feel when you explain that information.
By setting simple expectations at the beginning, you’ll boost the chances that the person will feel “confident” and “secure” about your talking points. Now, of course, this doesn’t guarantee the other party will feel the way you want them to, but it puts them in the right mindset.
As long as you’ve done your research, and know what emotional states another party values, by setting expectations you’ll have a much better chance of that emotional state occur (which can make the task of negotiation that much easier).
Voltaire once said, it is “far better to persuade, than conquer.” And by honing your real estate negotiation skills — and using expectations and research — you’ll find our real estate negotiations feel far more like a conversation than a marketing endeavor.
Do you have a negotiation strategy that you like to use? What have you tried in the past that worked? Let us know in the comments below.