September 12th, 2007 by Lee Mason, The Masters Realty Group LLC ;
I made the following comments to Larry Cragun’s post, You Take A Chance When You Make a Low Offer at the Seattle Real Estate Professionals blog this morning.
I don’t want to belabor the obvious, but negotiating skills vary among not only agents, but buyers and sellers.
I’m bemused by the number of agents who list “superior” negotiating skills as one services/benefits they bring their client, then fail to check their ego and emotions at the door.
Sure, emotions will invariably play a part, but educating your client up-front will minimize the extent to which they infect the negotiating process.
Does a buyer take a risk of offending a seller by making a low offer? Possibly… but isn’t this risk inherent when dealing with anyone who doesn’t know how to dance?
Negotiating styles vary (there’s 5 basic styles) and recognizing this principle is fundamental to negotiating success. Otherwise you’ll always assume the other party is just like you, that they negotiate just like you. When you don’t recognize the other party’s style is different (or even that there are differing styles), it makes for tough sledding.
Then there’s cultural differences. Members of some cultures routinely want to start at half (listed) price. On the other hand, I once had a powerful client from Japan who was concerned about offering anything less than full price for fear of loosing face. Again, educating the client is the key.
Any offer is better than no offer. A low offer may have a low probability of coming together, but you have a starting point, something to work with. (Especially if you’re a “superior” negotiator, right?)
If you can’t make it come together, graciously thank the other party for bringing forth the offer and move on.
You “gotta” learn how to dance.
2 responses so far ↓
1 Larry Cragun // Oct 1, 2007 at 6:11 pm
Just be careful, if you make a ridiculous offer on a home you want, you may just not get the home.
2 Lee Mason, The Masters Realty Group LLC // Oct 2, 2007 at 10:15 am
Hi Larry – thanks for your comment.
Of course you’re right – you may not get the home. But you must admit you could also make an over-full-price offer and still not get the home.
My comments were meant to make a couple of points:
1) Any offer is better than no offer (Yes, offering a $1 doesn’t count.) I generally counsel my sellers “We don’t get mad at people who come through your home and make low offers. We get mad (not literally) at people who come through your home and don’t make an offer.” Certainly an offer can be too low to warrant a written response. A simple verbal “Ah shucks, guys… thanks, but you’re outside the range of what we consider reasonable. However, we’d be happy to consider any future offer you’d care to make.”
2) As negotiations are a strategy game, if your response is based in your own emotions, it rarely helps advance your cause. This is not to be confused with strategically “flinching” and attempting to play upon the other parties emotions.
3) Not everyone possesses the same negotiating style, nor the same cultural background.
Larry, let me ask you a question. Based upon what I perceive as your (obvious) competence and experience, I think you’d probably concur with the majority of what I’ve stated above. If you’d been operating on behalf of an arm’s length client (as opposed to yourself), would your counsel to them have differed?
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