Real Estate Negotiation Techniques
By Steve Gillman - 2006
The last time you bought a home, you offered less than you
were willing to pay, right? This is the most common negotiation
technique, of course. Experienced investors, however, have more
powerful negotiation techniques in their arsenal. Why not learn
a few before you make your next offer?
How to Make an Offer - Ten Negotiation Techniques
1. Write the offer for an odd amount, like $161,793. It gives
the impression you know something the seller doesn't. They might
think you have a good reason for that particular price (and you
do - it's a good negotiation tactic).
2. Play helpless. Question things, talk slow, ask for help,
and never show off real estate knowledge. You can scare a seller
off, if they think you are smarter, and taking advantage of them.
3. Use the "limited authority" tactic. Tell the
seller "I'll have to check with my wife (or partner)."
It's easier for him to accept that you can't do something, rather
than the idea that you won't.
4. Use precedent. "My father bought his last house this
way." If the offer is unusual, sellers will feel more comfortable
once they know it's been done that way before.
5. Ask for things you don't need. This allows the seller to
win concessions when negotiating. Say, "I guess I don't
need the refrigerator, if I can get my price," and you're
more likely to get your price.
6. Be a reluctant buyer. Try saying "Well, I don't know..."
once in a while. This gets the seller looking for ways to please
you, and lets him feel he's won something when you settle a point.
7. Let the offer be their idea. "Are you saying you want
a later closing, and more earnest money? Well we can do it your
way, then. I just need..."
8. Get a yes before the offer. "What if I paid the price
you want, but I got my terms? Would that work for you?"
Even with some changes, it's hard for a seller to say no to an
offer he already agreed to.
9. Use flattery. Flattering the seller has been proven to
be worth an average of $1962 in real estate negotiations. I made
that up, by the way, but you know if he likes you, you'll probably
get a better deal.
10. Skip over problems, and return to them later. Agree on
every easy point first. It will feel like the house is sold,
and it will be difficult for a seller to then lose the deal over
an issue or two that you need to go in your favor.
You can spend a lot of time looking for cheap houses to buy.
Why not spend a little time learning how to purchase every home
for less, with some smart negotiation techniques?
If you liked this article on real estate negotiation, you
may also want to read the article on creative
real estate investing.
Another page to check out:
How to Sell a House -
Free e-book now on the pages of this site!