The highly complex world of real estate requires investors to exhibit a unique set of skills in order to realize their goals. One of these paramount skills is effective negotiation.
Investors need to negotiate to get a favorable deal. And while there is no hard and fast rule for negotiating with success, investors can learn and practice a few steps to negotiate like a pro. Here are a few of them:
Before placing an offer on any investment property, ensure you know every single detail about it. Conduct a thorough research on the property. Estimate its market price by comparing it with recently sold properties in the area. Speak to an agent for more information, if you have to.
Talk less, and listen more. This should be your mantra if you want to arrive at a successful deal. Let the other party speak first. It might be possible that their first offer is better than what you had in your mind.
Ask the other party as many questions as possible about the property. This will help make your case stronger for favorable terms.
It is critical that you formulate a list of significant questions before you view the property. Ask the other party for details, such property history, repairs, etc. Observe and listen to their answers carefully.
No matter what happens, do not resort to bullying. Successful negotiation is a two-way street and takes time. As real estate is an unpredictable business, you will be required to negotiate if something unexpected comes up. Don’t lose your patience or cool if things don’t go your way.
Don’t be bullied
Just like the way bullying is a big no, you should ensure you are not being bullied by anyone.
Don’t criticize for the sake of it
Unfortunately, this happens a lot. Criticizing someone’s property unnecessarily will not help you secure a good deal. Rather it is demeaning and rude. You are actually criticizing the home the owner has made for him and his family.
Make every effort to receive more from negotiation. Do not agree to a real estate contract without a request in return. Make small compromises that would enable the other party to gain trust in the deal. When dealing with renters, you can agree to pay for a gardener if the tenants sign a one-year lease.
Negotiation in real estate is a tricky business. Often, investors seek real estate coaching to master the art of negotiating. To read more about securing a good real estate deal, check out Fortune Builders—your ultimate guide to real estate investing education.