How to Negotiate Real Estate - Tips for Agents
Real estate agents depend on their negotiation skills to close deals and make an income, but knowing how to negotiate deals is a learned trait. The optimal way to hone your real estate negotiation tips is through practice. Yes, real estate negotiation training is important, but to really know which real estate negotiation tactics work for you, you need to read this guide, then jump in with both feet.
Choose Facts and Figures Over Emotions
Real estate is one of the most emotional transactions in business. Whether residential or commercial, your deals center on peoples’ lives and livelihoods. As the real estate professional in the room, you must be able to separate out the emotion and just use facts in your real estate negotiation. For example, if a listing agent is overpriced, be ready to (calmly) discuss the value of neighboring homes and why their initial price may be inflated. Be ready for these conversations, and avoid sounding shocked or surprised at what you may consider unreasonable negotiations. Business is business.
When you’re calm and deliberate, not only will you reassure your client that they picked the right person to represent them, but you’ll see greater success in your real estate agent negotiation overall.
Also, keep in mind that acting professionally benefits you in the long run too. If you’re unprofessional, your peers won’t want to work with you in real estate agent negotiations again. Leverage your credibility in the objective and transaction negotiation stage through your actions, like showing up early for negotiations and avoiding edgy jokes before knowing your client well enough.
Important Agent Negotiation Strategies to Consider
When it comes to real estate negotiation, each agent will find what works best for them through practice. For those just getting started, below is a list of real estate negotiation tactics that you should consider. How to negotiate real estate is unscientific, but these tips are a good foundation upon which you can build:
Stay positive, no matter how the negotiation unfolds. If you remain unflappable, you will exude confidence and demonstrate that you mean business. As they say in the world of poker, keep them guessing and only show your cards when you know you have a winning hand.
Be mindful of your body language. Keep the same upright and confident posture throughout the negotiation process. Smile and look people in the eye - don’t slouch or play with your hands. Remain in control of your body, and you’ll control the real estate negotiation.
The best real estate negotiation is done in person; it’s so hard to get a feel for people via phone or video chat. And there’s really no real estate negotiation training done online. So, if possible, conduct all real estate agent negotiation in person.
While this real estate negotiation tip might seem obvious, be reasonable in your negotiating. As the old adage goes, treat people the way you want to be treated.
No matter what happens with the deal, end the real estate agent negotiation on a positive note. As highlighted earlier, real estate agents often run into each other again and again. Keep in mind that you won’t win every single real estate negotiation deal, but if you end it professionally, people will remember that.
Build Trust With Your Clients
You’ve heard about your fellow agents and real estate negotiation tips related to engaging with your peers. Now we’ll delve into real estate negotiation tips regarding your clients. Clients are the most important factor in any real estate agent negotiation. When it comes to real estate negotiation tactics, put this on top of your list: build trust with your clients.
If your clients trust you, they’ll seek out your services again if needed. Even in the digital age of social media, word-of-mouth marketing continues to reign supreme. If you consistently handle yourself in a professional manner no matter what is thrown at you in the course of a real estate negotiation, word will spread. Given that purchasing or selling real estate is one of the largest transactions most people will undertake, it’s crucial that your clients trust you to secure the best deal for them. From the moment that you first speak with your potential client to the signing of your listing agreement, remember for whom you’re fighting and what they value when you sit down at the negotiation table. Simply put, if you want to learn how to negotiate real estate, remember that building trust with your clients goes a long way.
Did You Know: According to the NAR Code of Ethics, 44% of buyers said their real estate agents helped negotiate better sales contract terms, demonstrating the importance of negotiation skills.
Be Prepared for Any Offer
With knowledge comes power. That’s true in life and in real estate negotiation. But what does that mean exactly? As an agent, you should know your community and market better than anyone. With that insight comes the ability to receive any offer; you know what the property is worth in conjunction to the neighborhood and greater market as a whole, which prepares you to evaluate any offers that come your way.
In most cases, buyers and their agents are going to pitch an offer that might be too low to start. Offers generally fall into one of three categories: too low, just right, and too high. The latter two are the easiest to prepare for but bear in mind that receiving offers at asking price or above could also translate into receiving multiple offers. Walking your client through how to navigate these waters can be tricky, but the market insight you provide will help them. As for offers that are too low, this is where your market data and real estate negotiation tips can be put to good use.
Remind your client that a low offer isn’t personal or an insult to them; it’s a negotiation tactic by your fellow agent as a way to get their client the best deal. Simply present the offer, and let them know they can either turn the offer down (especially if it’s too low) or deliver a counter offer.
As an agent, you’re required to present every offer to the seller unless the seller has specified that they will not accept an offer of a certain number. As a real estate negotiation tactic, walking your client through each possible scenario will be incredibly helpful long before you sit down to negotiate the final deal. If you’re able to lay out what they should expect at the beginning of the process, your client will be better served in the end. Outlining realistic expectations is also a way to keep your clients’ emotions under control since not only will you be prepared for any offer, but so will they. When it comes to real estate negotiation tactics, managing the two “Es” (emotion and expectation) will make any real estate agent negotiation a little bit easier.
Find Common Ground
You’re at the table, and you’re about to start the real estate agent negotiation. First, find something that you and your fellow agent agree upon, and then go from there. The last thing you want to do with any negotiation is start off with something upon which you disagree. If you start the negotiation process on common ground, the rest of the interaction will likely be smoother.
Establishing a common ground makes it easier for the other agent and their client to see your client’s perspective. From there, you can find compromises on the things upon which you disagree. Remember your real estate negotiation training: Give a little, take a little. If you come to the table prepared for any offer that is thrown your way, you’re more likely to find the common ground that all negotiation needs to become successful.
Buying or selling real estate is one of the most emotional transactions a person undertakes. A real estate agent who knows how to negotiate great deals can help make that purchase (or sale) a better experience for their client. If you’re able to follow these real estate negotiation tips, you’ll get the best deal for your client while building your reputation as a positive force in the industry.