Negotiation. A Success Factor in Real Estate
Every real estate investor knows that a successful negotiation means a deal has been made. Or negotiate positively to have the upper hand.
Whatever it is, negotiation is crucial in your real estate investing business. Knowing how to structure your talks and prepare to negotiate can bring in mutual benefits between the vendor and the purchaser.
Having the right mental attitude before you talk can also means a difference between success and failure. Imagine a purchaser wanted to negotiate a deal with the vendor, but the purchaser has no idea how to start or deal with the vendor for a win win situation. Instead, the emotion takes over his head. In the end no deal has been done.
Negotiation can vary in real estate. A lot of aspects can be covered on what you can talk to your tenant, vendor or an agent. For example, the purchase price of a property can be negotiated between the vendor and the purchaser in order to bring mutual benefits and close the deal.
But who would want to buy a property higher than the market price and who would want to sell it at below market value? It doesn't make sense to them. Both parties want to have the advantages to themselves.
But with proper negotiation techniques, it can solve the problem. New and positive information are available and can be used to your advantage if you take the time and ask.
From the example in the previous paragraph, if the purchaser wants to buy the property below the asking price, then he or she can discuss with the seller what other agreements that can be made to lower the price. In this case it can be paying the full amount in cash or any other things. The possibilities are endless.
Besides price, you can also negotiate on other aspects in real estate such as mortgages, contract terms, rates, etc. Anything that can bring mutual benefits or answer's the "What's in it for me" question to both parties are negotiable.
One of the best things about real estate is that property values are market determined. So it is possible to utilize the negotiation skills in buying or selling properties with advantages to both parties in terms of closing the deal.
Return to Real Estate Mentors Homepage