Wednesday, July 5, 2023 / by Amy Brown
Negotiation is a skill set and not all people have it. If you look at those that are successful in business and relationships in general, you are likely looking at someone who is highly resourceful at negotiating. We see it all the time in court rooms, board rooms, and even your living room but when it comes to real estate, negotiation is key to getting you the optimal price, terms, and consummating the transaction in a manner that is agreeable for ALL parties involved. Let's take a look at some legendary negotiators.
- Henry Kissinger: Kissinger was a U.S. diplomat and national security advisor who played a key role in negotiating the end of the Vietnam War and the Camp David Accords. He is considered one of the most successful negotiators of the 20th century.
- Nelson Mandela: Mandela was a South African anti-apartheid revolutionary, political leader, and philanthropist who served as President of South Africa from 1994 to 1999. He was known for his ability to negotiate with both the apartheid government and the African National Congress (ANC) to end apartheid and bring about a peaceful transition to democracy.
- Herb Cohen: Cohen was a lawyer and business consultant who was known as the "world's greatest negotiator." He wrote several books on negotiation, including "You Can Negotiate Anything" and "The Art of the Deal."
- Chris Voss: Voss is a former FBI hostage negotiator who is now a negotiation consultant and author. He wrote the book "Never Split the Difference: Negotiating As If Your Life Depended On It," which is based on his experiences as a negotiator.
Negotiation skills matter because they allow you to achieve your goals both in real estate and in life. Here's how negotiation will make or break your real estate deal.
- Get what you want: Whether that's a net profit, a seller leaseback, or concessions, your agent should be able to "sell" the other agent on WHY those terms will be the most beneficial to both parties.
- Build relationships: Whether a temporary situation or not, the seller and the buyer will inadvertently have a close relationship throughout the course of the deal as will the agents on both sides. Having people skills that can bring all parties to the table in a non-confrontational manner is key to getting the job done.
- Resolve conflicts: It is inevitable that there will be bumps along the way. Can your agent identify conflict and provide an optimal solution before the situation gets out of hand? Are they emotionally capable of handling a high stress conflict environment with a calm and diplomatic approach?
Here are some of the specific skills to identify when interviewing agents to represent you:
- Communication: Effective communication is essential in negotiation. Do they allow you to clearly articulate your needs and wants, are able to listen, and provide multiple avenues of resolution?
- Problem-solving: Solutions need to work for everyone involved, however, a skilled negotiator is going to be able to find solutions that best represent THEIR CLIENT. It is crucial for your agent to be able to think creatively.
- Assertiveness: Cool heads prevail. Is your agent assertive without being aggressive? A skilled negotiator is able to stand up for their client while also being respectful of the other party.
- Empathy: Your agent needs to be able to understand the other party's perspective, even if they don't agree with it, which means that they should have experience working both sides of a real estate transaction. Having someone who is solely a listing agent or solely a buyer's agent step into a different role is never optimal for the client. You want conflict to be resolved through peaceful and solution oriented routes and that ability comes with experience of working both positions.
Key tips to successful negotiation:
- Do your research. Before you start negotiating, take some time to research the issue at hand. This will help you understand the other party's position and come up with a strong argument for your own position.
- Be prepared to walk away. If you're not happy with the terms of the negotiation, be prepared to walk away. This will show the other party that you're serious about getting what you want.
- Be flexible. Don't be afraid to compromise. Sometimes, the best way to get what you want is to be willing to give a little on your side.
- Be positive. Negotiation is more likely to be successful if you approach it with a positive attitude. Be respectful of the other party and focus on finding solutions that work for everyone involved.
While I'm no Kissinger, I do have significant experience with negotiation. I have several degrees but one of them happens to be in the field of business contract law. It is my favorite part of the job and I relish in finding creative solutions to stifle objections before they are even brought to the table. My matter-of-fact, no nonsense business style has served me and my clients well through the years. I look forward to assisting you with your next negotiation.