Negotiations are a huge part of a Realtor’s job. It’s pretty much dominated my activities for the past week.
A business is negotiating to purchase a parcel of land that I listed.
I’ve been negotiating on behalf of the sellers of another property.
And another seller has been asking for advice as they negotiate with a neighbor who wants to buy their property before it’s listed on the open market.
Every buyer, almost without fail, starts with a low ball offer. So my first job is to help sellers understand that it’s not meant as an insult. It’s a trial balloon, just to see what might be possible.
But the response the sellers give adjusts the goal posts, and helps everyone understand just how much (or how little) latitude there is in the price. It also lets a buyer know how motivated a seller is. Motivated sellers tend to concede more. If they don’t *need* to sell, that’s a strong hand, and it comes down to how badly the buyers want the property.
And when a property’s not listed yet, a buyer needs to realize they’d better make a strong offer, because once a good property is on the open market, the likelihood of a much stronger offer is very real. And they’ll be living next door to the property they wanted, knowing they could have had it, but lost out.
The price is only one part of the negotiation. A Realtor also has to understand what the clients need. Sellers might need time to buy or build a new home. Or they may have multiple people to deal with before agreeing to a sale (often the case in an estate).
Sellers also have to be aware that the final agreement on price may not be the final agreement. If there is an inspection, which there almost always is, a buyer will likely try to renegotiate based on issues found. And there are almost always issues, no matter how perfect the property.
How to get around that? Sellers can stipulate in the contract that the inspection is for buyers’ information only, and there will be no further negotiations. That lets buyers walk away if they find a major issue, but it doesn’t open the door to a further price reduction unless the sellers decide they want to do so to salvage the deal. It’s a double-edged sword, because it can be perceived by buyers as indicating there are issues. But with an obviously well kept property, it tends to work in the sellers’ favor.
Emotions can’t be part of the negotiating process. The Realtor’s job is to stay neutral, and remember that as long as everyone wants the sale to happen, our role is to make that happen. We work to understand what motivates whatever a buyer or seller suggests, and find a way to achieve an agreement that satisfies all sides and gets them to a closing.
Today, I’m meeting with sellers who need to carefully cross every t and dot every i, because every detail is essential for making a proposed sale work for them. My job is to try to think of everything, to come up with a proposal that buyers will accept, and then let their lawyers make sure all details are in order before approving a contract.
It’s a ton of responsibility because it’s important to do it well. And I’ll confess — it’s a really satisfying part of my work.