WHY REAL ESTATE AGENTS NEED NEGOTIATION SKILLS
As a real estate agent, your income is defined by your knowledge to close the deal. To become a successful real estate agent, you will have to find the most creative and powerful negotiation strategies. Getting clients is only the first step in the real estate process. The next crucial move is negotiating with the other side. In a real estate deal where sellers want the highest price and buyers want the best deal, the two have to meet somewhere in the middle to close the deal. Because if you are the buyer and you do not ask, you do not get. Negotiating for a home is important since this is the largest asset most people want to own and a lot of cash is at stake.
Understanding Real Estate Negotiations
Real estate negotiation is an art that involves two or more parties trying to find a common middle ground between both to close the deal.
Key real estate negotiation strategies:
Price
Buyers don’t want to pay more or price themselves out of a resale in the future, while sellers want to make sure the deal makes sense for their financial plan.
Closing Cost
A buyer may ask a seller to pay a flat amount towards their closing costs, or up to a percentage for what’s an allowable contribution for a lender. Sometimes this can be up to 2-3% included in the mortgage.
Be Proactive, Not Reactive
During a real estate deal, it is better to be proactive rather than reactive. Most people prefer to speak more than listen during a real estate deal. This often leads to no deal for anyone. So, it is always advisable to listen closely to the other party. It is important to communicate clearly and listen with empathy. Don’t be negative and reactive.
Asking multiple questions leads to positive answers
Ask as many questions as you want to ask from the seller of the property. Both buyers and sellers need to be adjustable and open-minded when trying to convince someone else to change their minds in order to close a deal.
Counseling Your Clients
As an agent, you must use this knowledge. Buying or selling a home is not only a financial decision but also an emotional one. Real estate agents who are skilled negotiators understand this on a deeper level. Even if you are not able to read the minds, knowing the negotiation framework and methodologies will equip you with the skills to accurately read the situation in play and respond effectively.
Information is Power
Most people manage to understand that negotiation is always about money, but often it is not. Smart negotiators understand that in many cases, it is more important to solve a problem than to offer the maximum money.
Closing Date
A seller can negotiate for speed when they want to get their capital out of the home fast, and closing dates will hit buyers’ monthly cash flow once they own the home.
Differentiating Yourself
You can develop your negotiation skills by working actively. In this way, you can give yourself an edge over the competition and increase the possibility to make the clients happy and that they will further refer you to others.
Negotiate in person, not by phone
When managing emails or texts to negotiate, tones and intentions are not clearly understood. Someone may be hurt by a typed comment which was truly favorable, neutral, or even meant to be funny.
Body Language
A better option is to have an open posture and a smile on your face. Try to look at the other people in the eye as much as possible to help you seem more honest and trustworthy.
Don’t emotionally attach to the deal
Even if you desperately need the commission for this one real estate deal, please don’t pretend reactive fear. Ironically, the fear of missing the deal can be noticed by others in the room, resulting in rejection of the deal.
Good Sense of Humor
Show your good sense of humor when required.
Close the Negotiation on a Good Note
Before leaving the room, make sure that everyone feels positive about the outcome. Shake hands and thank each other for their participation, and talk about the next positive steps in the process.
