Sellers pour their heart, soul and finances into a home expecting a return. Buyers, work hard for their money and want the best deal. And, Realtors advocate for their respective client's interest. Residential real estate contract negotiations are a gentleman's negotiation (or womans). One 'gentleman' is proposing to buy another gentleman's home.
Both parties need to separate the 'issues' from their personal 'positions' and negotiate price, terms, conditions and dates, without lack of respect or insensitivity, while still advocating for their own interests. I've yet to see a transaction, in which one party turned into a classic urinating contest, that didn't ultimately implode. After the initial negotiations, there are other hurdles throughout the transaction that will need to be resolved. Squeezing the last penny or bit of dignity out of the other party during the initial negotiations will leave zero room for further negotiations if needed. Nor will it motivate that party to do further good will. Such as the seller leaving the home in broom swept condition versus impeccable or the buyer not nickel and diming on the repairs.
Begin the process by building good rapport and set a friendly tone because you will be negotiating the largest transaction of your life with a stranger. Buyers, be on time to showings and sellers have the house ready to show. I tell buyers all the time, 'you don't want to make the seller mad before you even present an offer.' (ie: being late for a showing appt or wearing muddy shoes through the house) Always respond to all offers from the other party in a timely fashion and communicate any and all delays.
Market customs and norms vary in negotiations so learn what is traditional in your market first. For example, here in the Midwest, most sellers do not take kindly to low ball offers and in a lot of cases will flat out refuse to negotiate with the buyer at all who takes this approach. Oklahoma didn't have a 'bubble' and home prices weren't grossly inflated. Thus, buyers bringing a distressed market mentality to the table here are normally very disappointed to find out most homes sell within 97% to 100% of list price. I know in other regions throughout the country, sellers deliberately price 20% higher than they are willing to take. Again, know the market before assuming all negotiation strategies are handled the same in all places. As a Realtor and investor in the business for nearly 20 years, I've NEVER had to confrontationally bargain to get the best deal anywhere in the country.
1. Don't take personal offense to every aspect of the initial offer the buyer presents. Remember, they are asking for their 'ideal' but it doesn't mean they won't deal. You already asked for your 'ideal' it's called the list price and you will have an opportunity to counter if need be.
2. Familiarize yourself with typical buyer concessions and timelines asked for by the buyer before you list your home.
3. If you price your home well above the competition then don't be surprised if you get a lower than expected offer.
4. Determine if it is advantageous to explain the reasoning for your counter proposals to obtain the buyer's understanding.
1. Not all sellers are distressed or under duress. You can negotiate an awesome deal without being insulting.
2. Understand that 'Home is where the heart is.' Thus, most sellers have a difficult time with buyers whose attitude is, 'It's just business not personal.'
3. Determine if it is advantageous to explain your reasoning, tactfully, for your initial offer and or counters to obtain the sellers understanding.
1. Assertively negotiate for your client without impeding the process between two willing parties.
2. Communicate, communicate, and communicate. When parties are left to wonder what is going on they tend to make negative assumptions.
3. Don't make it personal when the opposite party undermines a false expectation you might have created in your client.
4. Yelling at and berating the other agent doesn't get your client's point across and typically doesn't result in a desired outcome. It just alienates and impedes the negotiations further.
5. If verbal communications fail, put everything in writing to avoid personality conflicts.
6. Avoid confrontational clients, they'll only ruin your reputation. Ultimately, the buyer and seller don't remember the other but they do remember the Agent who represented the aggressor.