Whose Side Are You On Anyway… Real Estate Negotiating Tactic
Your ability to negotiate well with sellers will determine the ultimate profitability of every deal that you do. The better negotiator you are, the better (and more) deals you’re going to get.
In my real estate investing business, my partner, Dusty Keefe, meets with all of our seller leads. And let me tell you, Dusty is a master negotiator!
Today, I’m going to tell you about one of the negotiating tactics that he uses with great success. It allows him to maintain control of every meeting, takes all the pressure off his shoulders, and puts him on the same side of the table as the sellers. . . which is where you want to be.
The Higher Authority Negotiating Angle With a Twist
That’s right! You’ve probably heard of the higher authority angle before, but Dusty has his own unique twist that he puts on it when meeting with sellers.
First, let me explain what the higher authority angle is in negotiating. It’s when you position yourself as “NOT” the sole decision maker. You may tell your prospect that you have a partner that you have to pass everything by or you may tell them that you’re just working for the owners who make the ultimate decision. This takes you out of the commanding role of the decision maker which is vitally important in negotiating. Because as soon as someone knows that the decision is up to you. . . they’re going to make you pay for it.
How you might ask?
If someone finds out that you’re the decision maker, they can begin to shower you with sob stories that use guilt to appeal to your emotions. Once you become emotionally involved with a seller, their situation, or their property, YOU LOSE!
How to Put This Real Estate Negotiating Tactic to Work
When meeting with a seller, say something like this:
“Mr. and Mrs. Seller, thanks for meeting with me today! I’d like to start off by explaining a little bit about my role here today, how the company works, and the how we can move forward to see if we may be a fit to work together.
First off, I like to be very upfront and say that the company would have to be able to make a profit on your property for it to make sense for them to buy. If you’re OK with that, then we should continue talking. . .
and that doesn’t necessarily mean that your house would qualify for them to buy either. My job with you today is to find out exactly what your situation is and what your needs are. There are many different ways for us to structure deals so the more information we have, the better chance that the company can buy your house quickly.
Once we have all the information we would need, I can help you put together an offer that we think the owners will accept.
If that all sounds good, let’s go ahead and get started. . .”
By structuring your meeting this way, you have completely removed yourself as someone that the seller can negotiate with. You’ve also let them know the intention is to profit from the property. You disqualified them by saying that their house may not qualify (you always want to remain in the reluctant role). You’ve encouraged them to share information with you. And, you’ve positioned yourself on the same side of the table with the seller by saying you’ll help them put together an offer that’s likely to get accepted.
This very powerful and easy technique will give you the upper hand when negotiating with sellers.
Category: Negotiating, Real Estate Investment Buying Strategies, Tips and Tricks
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