Useful Property Negotiation Tricks
Property negotiations, without fail, bring up a few critical points to the fore. If they don’t, they aren’t negotiations and you are far from talking turkey yet. While every negotiation is expected to give us a winner, the best property negotiations are those which give us two clear winners- the buyer and the vendor….yes a win-win situation for both.
What Mr. Vendor are you looking at?
As a buyer, what your stance should be. First things first, never come up with the initial quote yourself. It is said, and wisely so, that the party that first bares its pockets loses the deal. So as a buyer, you should not declare the depth of your resources and probe the vendor first. “how much are you looking at?” works fine.
You have got options…let it be known to the vendor
Let the vendor know, either by directly telling him so or suggesting it through the agent, that you have got options with you. It is perception rather than reality that can claim the deal for you. It is only helpful that the property market has picked up quite a bit and the vendors won’t need to be convinced hard that you have got options aplenty.
Probe the pain point of the vendor
Look for what precisely interests the vendor. The really smart buyers prefigure those vulnerabilities. May be the vendor wants some money really quick or the city has just become a place too emotionally charged for his comfort. So if you find out the reason why he wants to get rid of the property, you can come up with one fine axe stroke that “fells the tree”. At such a point, make a really robust quote. I have always felt that the first quote needs to be realistic and really big….rather than fiddling around with low quotes and going higher in stages. You certainly don’t talk turkey this way.
Show vulnerability and then sudden strength
I love the quote, “Never negotiate out of fear but never fear to negotiate”. Simply deciphered, it means that you need to be skilful during the entire phase of bargain. Sometimes, may be, you just need to show that you are weak and vulnerable during the negotiations. What I refer to as “eating out of your vendor’s hands” and then jumping with a killer punch with a show of strength he does not expect at all.
Give the vendor’s agent a bait
You can give you vendor’s agent something to chew. If I was in your place with a property flip on mind (yes those fixer-uppers), I would have offered the agent the deal for the resale, too. Yes, only if he got me a good price on the original deal that is.
Seasoned buyer’s agent can help you lap well-discounted properties in coveted areas and this is like saying something at a time vendor discounts are waning and good neighbourhood purchases are becoming increasingly difficult. You can get in touch with me to talk more about your prospective home purchase.