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Negotiation

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Negotiation

  1. 1. Negotiation<br />Sales Meeting<br />December 1, 2010<br />
  2. 2. Video<br />Negotiation Skills- <br />Communication Training<br />
  3. 3. Commission Negotiation<br />What if the Seller wants to pay you a lower commission? <br />ask questions to understand why<br />if you don’t want to accept that lower fee you have to try to show them why it’s not in their best interest to pay you a lower fee<br />Focus on the Seller’s needs:<br />Don’t Say: I spend a lot of money on advertising so I need to charge a higher fee to pay for that advertising.<br />Say: The extra advertising and marketing we do helps us average a 2% higher sales price for you in half the normal time.<br />Say: I know you can get a lower fee elsewhere but what have you really saved if you get a 1% lower fee and a $20,000 lower price for your home because the other agent isn’t a trained negotiator?<br />
  4. 4. Trust<br />Most important strategy in any negotiation<br />Buyers and sellers know that the other party has interests that are in conflict with theirs<br />Establish common ground:<br />Communicate that they have a common hobby, the same type of job, etc<br />Present evidence that your clients are qualified to buy the property<br />Never delay your counteroffers. Show respect for the seller's time.<br />Communicate that the buyer appreciates the home. <br />
  5. 5. Ego<br />Never run down the sellers' home<br />Don’t: <br />Point out faults and deficiencies<br />Explain why the home is not worth the price<br />Anchor your offer price to market data<br />
  6. 6. Stay on Their Team<br />A united front is a strong negotiating position<br />Example: The wife may love the house, but the husband wants to negotiate the price<br />
  7. 7. Keep a Grain of Salt<br />Not everything you are told is true<br />contract has to be in this quarter<br />the price is going up<br />1% bonus for contract this week<br />
  8. 8. Little Things, Big Difference<br />Slower Pace - The sellers were a couple in their 90's. Since they did not leave the house, the buyers met them several times. The buyers took extra time to sit down and talk, and formed a strong bond. <br />Holy Ground - The sellers had a small grave for their dog on the property, which they were very sensitive about. The buyers realized this, and sent word that they would leave it in place. <br />For the Birds - The sellers had numerous bird feeders on the property. The buyers keyed in on this, and offered to continue feeding the birds.<br />
  9. 9. Discuss This…<br />Get better negotiating power by discussing these items before sending the offer:<br />How is the market in general? How are other actives and recent sales priced? <br />How long has the home been on the market? Have there been price changes?<br />Did the house sell recently? What was the price?<br />Is there a time deadline that must be met? Would a pre or post lease be desirable?<br />What is the appraisal district value? The taxes? The HOA dues?<br />Is a disclosure available? A property inspection? A survey?<br />Are there any offers expected, or on the table now? <br />
  10. 10. Understand the Seller<br />What are the pressures on the seller of this house?<br />Down Market<br />New Job, Need to move<br />Already made an offer on a new home<br />Facing Bankruptcy<br />
  11. 11. Plan B<br />Identify several other properties the client would be happy with as well<br />Save you from giving in to whatever the seller wants<br />Puts the pressure on sellers if they know you have other options<br />
  12. 12. 12 Ways to Become a Better Negotiator<br />1. Learn everything you can about the situation, the issues, and the participants.<br />2. Understand all the participants’ needs and interests.<br />3. Set reasonable goals for what you hope to achieve during the negotiation, and rank them by priority.<br />4. Work within a range that includes minimums, targets, and maximums.<br />5. Anticipate the other parties’ comments and prepare your responses.<br />6. Remain calm, pleasant, and unflappable.<br />
  13. 13. 7. Build trust by clearly stating what your client wants and respecting what the other parties want.<br />8. Create an atmosphere of joint problem solving that focuses on the benefits to all parties.<br />9. Remain flexible and open to a range of options.<br />10. When other people speak, listen attentively and hear them out fully.<br />11. Use empathic comments and sympathetic gestures and facial expressions to smooth over difficult situations.<br />12. Always underpromise and overdeliver.<br />12 Ways to Become a Better Negotiator<br />
  14. 14. Negotiating Tactics<br />Silent Treatment<br />Silence makes people uncomfortable<br />The Flinch<br />Small sound or facial expression that communicates displeasure<br />The Deadline<br />Create Motivation, Stay on track<br />The Competition<br />Remind seller that buyer liked many other properties<br />The Departure<br />Gather papers if negotiation has reached a deadlock<br />
  15. 15. Types of People in Negotiations<br />Verbalizers<br />Talk through issues<br />Emotional<br />Convincers<br />Want to “win”<br />Rationals<br />Not emotion based<br />Want written details<br />Reasonables<br />Easy going<br />May require more hand holding<br />
  16. 16. External Features that Influence Negotiation<br />Market Conditions<br />Properties Physical Features<br />Buyers Personal Tastes<br />
  17. 17. Negotiation Ideas<br />Keep the earnest money deposit receipt in your hand when you are telling the sellers about the offer. <br />If you’re not sure you’re getting the best deal, stall. Many buyers and sellers get nervous when the other party hesitates.<br />Explain the risk of rejecting an offer. If the sellers are presented with an offer of $149,000 on their $150,000 house and they counter at $150,000, they are gambling $149,000 to gain $1,000.<br />
  18. 18. Questions-or-Comments<br />

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