After nearly two decades as a Real Estate Student and Investor I discovered that it's true that real estate investing is not for everyone, and it's not a get rich quick scheme either. So if you're thinking that this is for you, there are no guarantees your first wholesale deal will come rapped in a bow. Dream on right!
Prepare for the long haul even if someone does hand you that Nugget complete with a fifty thousand dollar check built-in at your very first closing.
Real estate is my passion, and I approach the business side from a problem solving perspective which is how I approach all business. I'm confident that any situation can be solved when all parties and information are at the table with the interest to do so.
Negotiations in real-estate deals is all about compromising and agreeing in order to close a transaction. When negotiating, we just want to know what you want and what you needs so the transaction can continue to move forward. Legal knowledge is important too, since the negotiator should be able to identify the legal processes that could be done to achieve the seller's needs. As Negotiators we usually have access knowledgeable real-estate lawyers, and most real estate agents are capable of negotiating for their clients if that is indeed the case.
To get successful negotiation results, it is important to be informed, prepared and set realistic goals or objectives. If you are a buyer and you have come across a house you are willing to buy from us, then you would have to be properly informed on how much the property would cost on the open market. You could ask your agent to compare it to similar properties which have sold in the last 90 Days to 6 Months. This is called Comparable Market Analysis or CMA. In CMA, the condition, size, number of rooms of both houses would be compared.
Once you have the information, then you would have to prepare for the negotiation with your end game plan in mind i.e. what am I going to do with this once I own it. You could start by setting a realistic amount of money you are willing to spend on the property in that location. When making decisions about buying or selling a home, never let your emotions get the best of you to the point that you totally forget about your End Game Plan for the property. You Must Respect The Process By Following And Executing The Plan.
There are different real-estate negotiation tips that would make both the buyer and seller satisfied.
• You start with an offer that you know that they would not be able to refuse and not a quote that would make them angry or rolling in laughter. When presenting the offer, make sure that you or the negotiator would state what and how both parties would benefit from the deal.
• It is normal that the opposite party would ask questions and state their expectations, but be confident when answering. Be cool and calm, even if the negatiations are pushing all of your wrong buttons. Present the answers in a way that would help them see that they have a way of getting out of the deal if you don't perform in a timely manner.
• You do not have to say or show how desperate or excited you are to purchase the property. If you would like to convince the other party to roll-over, don’t overreact with the offers or quotations or try bluffing with the other party. Be straightforward with your win-win solution and be prepared to counter their offer or concerns. Look for loopholes and weaknesses which would help turn the table around.
• Be realistic, know your market. Do not overprice nor underprice. Usually, a buyer would have to spend a little more than what you are willing to, to get the house and the property that they would like to have. Asking for a very low price for the sake of doing so is like an insult to the person who is selling the property so be respectful.
• When starting with the negotiations and an offer is on the table it is better to correspond with written documents. Oral commitments simply cannot stand up or are not duly recognized as a binding agreement by some states your partner etc.
• When negotiating, do not focus on the small details. There are times that people walk away because of small issues that could easily be dealt with in minutes or simply pushed aside.
In real estate negotiations, it is a give and take that works best, enabling both parties to move towards an agreement. Both parties should start with the points that they both agree on and deal with the differences later in the conversation. Sharing a common ground makes it easier for both parties to come up with the best win-win solutions.