Negotiating Power: Who Has It and Who Doesn't

By
Real Estate Agent with Keller Williams Realty

Negotiating Power:  Who Has It and Who Doesn't

I work with buyers and sellers and one thing that many of them lack is the power and understanding of being in a position of strength when it comes to negotiating.

At the very heart of the matter is having something of value to negotiate with and below is an abbreviated list of examples of what may constitute something of valuel:

For the home buyer

  • A pre-approval letter
  • A sizeable downpayment
  • Good credit (to negotiate the best rate with yoru lender)
  • Ability to pay own closing cost
  • The ability to close quickly
  • Think like a seller and use it to your advantage
Note to buyers:  A mere expressed interest in a property does not put you in a position of strength when it comes to negotiating.
 
For the seller
  • A home that is appropriately priced (resulting in high buyer interest)
  • Multiple offers
  • A rare listing in a highly sought after neighborhood/community
  • Flexible closing cost assistance
  • Readily available routine maintenance records (HVAC, roof, electrical, etc)
  • The ability to close quickly
  • The inclusion of amenities (your high end appliances......hint, you can always buy yourself some mroe of these)
  • Understanding buyer motivation
Note to sellers:  What your neighbors received for their home (which is not comparable to your home) is not considered being in a position of strength.  Understanding of true comps will help you in the long run.
 
The overriding concept of negotiating is that each party negotiates based on valuable consideration.  In other words, during the negotiations, each party recognizes and is willing to compromise on items of value to them. The end result is that neither party may not get everything that they want, but they were flexible enough to negotiate for the most important and trade off items that ranked lower on the totem pole of importance.
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Re-Bloggged 3 times:

Re-Blogged By Re-Blogged At
  1. Elyse Berman, PA, ABR, GRI, Realtor 01/07/2012 12:05 AM
  2. Karen Winters 01/07/2012 10:03 PM
  3. Pete X-GRI, CDPE 07/28/2012 05:11 AM
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Rainmaker
680,091
Lanre Folayan
I don't make promises. But I do deliver results.
Keller Williams Capital Properties-Buy a home in Washington DC. Sell a home in Washington DC

Charita great way of breaking it down for both home buyers and sellers. I SUGGESTED THIS ONE FOR A FEATURE ALSO.

January 07, 2012 10:33 PM
Ambassador
681,351
Charita Cadenhead
Serving Jefferson and Shelby Counties (Alabama)
Keller Williams Realty

Exactly Elyse and how do they know that they can always get it.  It's almost as if we are just supposed to take their word for it.

Kathy it seems that while the focus is on the HOUSE, people get lost when it comes to negotiating for the sale and purchase.

Evelyn unless the object has true sentimental value (such as an item from a deceased parent as an example), sellers should be willing to let it go if it is the only thing hindering a sale.

Thanks Lanre.  This is something that I think we all share with buyers and sellers. The ones who understand it are the ones that fare far better.

January 09, 2012 05:34 AM
Rainmaker
921,646
Lisa Von Domek
....Experience Isn't Expensive.... It's Priceless!
Lisa Von Domek & Associates LLC, Real Estate Broker/Associate with Real Living Real Estate Group www.LisaVon.com

Good morning Charita,

Well stated, the power is in the something of value and not getting lost in inane details.  

January 09, 2012 08:47 AM
Rainmaker
939,901
Kathy Clulow
CNE - ASP - SRES .... Uxbridge Ontario Real Estate
RE/MAX All-Stars Realty Inc. Brokerage

Charita - WHO and WHY ..... dealing from a position of strength and knowing it makes a difference when presenting an offer

Understanding the importance of "who" is in the position of power during negotiations and "why" is crucial to our buyers and sellers when they are making a decision on an offer.

January 10, 2012 04:45 PM
Rainmaker
612,517
Bob Miller
The Ruiz/Miller Team - Ocala's Dream Team
Keller Williams Cornerstone Realty

Hi Charita, you wrote a great post.  Too bad this spam got on here.  Maybe you can get it off.

July 28, 2012 05:18 AM
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Charita Cadenhead

Serving Jefferson and Shelby Counties (Alabama)
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