Quite often I see buyers and sellers request an agent with the number one prerequisite that they be a good negotiator. But what does that mean? What does that mean to the real estate agent and to the consumer who is requesting this quality? And does the consumer really understand what a good negotiator does in a real estate transaction? Is the real estate negotiator’s job solely to get the price up for the sellers and down for the buyers or are there other issues that qualify a real estate agent as a good negotiator?

 

As a professional who has been practicing real estate for over 13 years, I attest that negotiations start even before the buyer sees the house or the seller puts the property on the market and does not end until after the closing papers are signed and even beyond. In this article I will focus on negotiating for the buyers (and only refer to the sellers, periodically) to provide a clarity of examples and not look for a parallel at every turn. 

 

Since I work primarily with first time home buyers, I can see clearly where my experience and expertise in negotiations is most valuable. Being astute listener is the best skill a good negotiator can have when it comes to get the buyers what the want. A real estate agent should understand the buyers’ needs at first meeting. One achieves this result by asking the right questions and applying the answers to the criteria and the process of buying a home. If the buyers give an indication that they are not sure of their financial stability, this issue should be addressed foremost. If the buyers indicate that they are not sure of the area or criteria for their new home, the real estate agent must discuss and give options to formulate a better plan of action to achieve the ultimate result of acquiring a property.

 

Once the buyer is focused, it is time to look at what is available on the market. At times, preliminary negotiations take place at the appointment booking. As an example, when the property is priced at or above the buyers’ financial comfort level, the real estate agent can finesse the information out of the listing agent as to the sellers’ firmness on the price. This can go a long way once the negotiations on the offer take place. A good negotiator is a good researcher. A real estate agent who is worth his/her weight in gold will never give you an opinion of value without full market analyses, no matter how experienced they are in that location. Market changes practically on a daily bases and unless you write offers or go over market statistics on a daily bases, you need a market analyses, specific to the subject property, to determine the home’s value. The next step for a good negotiator is to plan out a strategy with the buyers to achieve the goal of getting that house and getting it at the price the buyers have decided they want to pay. At this juncture, the buyers should to be aware that, (especially in a seller’s market) sometimes, an agent’s job is to beat out the other competing buyers and just get that house for the clients. Sometimes a negotiating strategy has to be changed midstream when the agent finds out that there are multiple offers. 

 

A good negotiator knows what questions to ask and how to ask them. Prior to presenting an offer, a good negotiator will talk with the listing agent to determine motivation, time line and any other elements of information which can be useful in negotiating the offer. 

 

A good negotiator will make the buyers real and human to the sellers and listing agent. I always include an introductory letter with our offer, from the buyers to let the sellers learn a little about the buyers’ motivation, interest in the house and financial ability. Rejecting a human being is a lot harder than rejecting a price that is too low. Knowing when to give a little is a good negotiating tactic. Beating up a seller on the price is not advisable even when you know you can. You never know when you might need something down the road. Being true to your word is paramount for a good negotiator. If you tell the seller that that your offer expires at a certain time, make sure that it does. If you allow for something (such as an arbitrary time extension), the seller or listing agent will know that you will bend on other items as well. Work out all possible scenarios before presenting offers so that you know how to respond when the time comes. 

 

A good negotiator is always negotiating. Through out the transaction, there will be times for discussion when buyers and sellers will want something from the other party. A real estate agent will use his/her experience to be sensitive to know when to ask and for how much. A good negotiator knows that the ideal negotiation is a “win – win” negotiation. There are no losers when it comes to a successful process, everyone should come out a winer!