How to Negotiate Profitable Real Estate Deals
How to Negotiate Real Estate Deals Like a Realtor
Some home buyers and sellers have mastered the art of negotiating real estate deals. Finding ways to leverage your position is nothing short of an art form. When negotiating is done correctly, you may be able to get extra value from your real estate deal.
We’ve rounded up 8 important tactics that you need to use for your next negotiations, whether you’re a home buyer or seller.
Negotiating is an important asset that realtors use
1. Remain Calm and Relaxed
Remember, this isn’t a hostage negotiation. Both parties (home buyers and home sellers) want to walk away from the negotiation with something. Keep yourself relaxed and calmly discuss the details one by one.
Someone who seems at ease during a negotiation will often find it easier to leverage certain outcomes. Displaying that you’re relaxed shows the other party that you don’t feel pressure to commit to their deal or make concessions. Instead of risking losing the real estate transaction, the other party may be more likely to meet your needs.
Also, there’s no need to overshare and talk for extended periods about your interests. If you’re answering questions from the other party, being direct is the best approach.
2. Know the Property Inside and Out
You wouldn’t feel great buying a car from a salesman who can’t answer your questions. It’s no different with real estate. Even though you’ll probably have the help of an experienced realtor, you should always be familiar with the property.
For home sellers, that means getting answers to the buyer's questions. Even though it’s your home, there might be specific questions you can’t answer without a bit of research.
For home buyers, there’s only so much research you can do, but that doesn’t mean you should enter the negotiations blind. Make sure to get your local realtor to collect history about the home, as well as the surrounding neighborhood, to catch any details worth knowing. Make yourself aware of any property damage and significant changes to the landscaping or construction.
Knowing the property boosts your negotiating power
3. Be Aware of Your Local Market
If you want to negotiate for yourself, make sure you know if the market is favoring buyers or sellers. When the market favors buyers, home prices are lower than normal and they tend to remain listed for longer. In a seller’s market, demand for property is high, so homes are priced higher and sell faster.
Knowing your local real estate market will help you in the negotiations because it helps you understand the current value of the property.
4. Always Operate Honestly
There is no benefit to lying during a real estate negotiation. There’s a high chance that any details you withhold or misrepresent could violate your contract and cost you money later, or void the sale entirely. Conduct yourself honestly at all times.
Being trustworthy can have a positive impact on the real estate transaction. Leverage can come from trust, but that will be different for every negotiation. One thing’s for sure though; lying is a good way to lose leverage entirely.
5. Negotiate like it’s Not Your Last Deal
If the other team in the negotiation knows that this is your last real estate transaction, they might leverage that knowledge. You want to have the demeanor of someone who isn’t negotiating their first (or final) real estate deal.
If you’re negotiating a real estate deal, never act like you are in a rush either. Property is one of the largest purchases people make, so it’s a “red flag” to see haste and urgency during a negotiation. Of course, some homebuyers need to move quickly to close a deal, but within reason.
6. Meet With Your Realtor Before Negotiations Begin
Always meet with your realtor before the negotiations start and understand exactly what your goals are. You need to go into the meeting with a clear objective, but also, you need to know exactly where your boundaries are.
Your realtor will also let you know what the other party might propose during the negotiation.
If you’re negotiating on your own behalf, you should get some input from a local realtor. They can provide valuable insight into the real estate market and possibly find ways to leverage your position.
A meeting will align you and your team of realtors
7. Your Words Are Important - Choose Them Wisely
The wording of certain statements during a real estate negotiation can be very important. This isn’t something you have to worry about if you’ll have the help of a realtor during negotiations, but it’s good to be aware of it.
Always try to negotiate with clear language. Instead of using words like “might, maybe”, and “could,” try to be more definitive. If you feel that you need to refuse or say no, you should feel comfortable doing so.
There’s a difference between speaking firmly and creating friction. It’s possible to remain polite and refuse at the same time.
It’s always better to be direct when negotiating real estate deals, whether you are the buyer or seller. You’ll receive more respect from the other party when you’re upfront and direct.
8. Know Who You’re Negotiating With
Don’t attend a negotiation without knowing who will be sitting across from the table.
For home buyers: Are you buying property from an individual or a corporation? If you know who you are buying the property from, you may be able to leverage that information to your advantage.
For home sellers: Are you selling a property to a first-time homebuyer or a major developer? Of course, we can’t generalize and say that there are only two kinds of buyers, but try to understand their intentions. This will help you market the home more attractively, depending on the buyer’s plans for the property.
Get the backstory!
Get Expert Negotiators on Your Side of the Table
Realtors are the best people to have on your side during a real estate negotiation (especially local ones). They’ve spent their careers becoming familiar with the market and know how to protect your interests from start to finish.
Since 2008, the Jamison Team has helped hundreds of families buy and sell property in Santa Clara County. They’ve got an outstanding record (with testimonials to match) and the team prides itself on having a much higher chance of success than other comparable agencies.
Don’t worry; there’s no pressure and no obligation if you want to get in touch with the Jamison Team and ask them questions. If you’re curious about negotiating real estate deals, their team can give you the solution.