Obviously we are in a buyer’s market and negotiations are completely skewed to the buyers.  BUT, playing too hard can backfire.  If you are just looking for a deal then you can just keep putting offers out until you get someone to bite. It works.

Consistently, the easiest transactions are the ones where both sides are trying to be fair, not just trying to get a every single penny that they can out of the seller.  If one side feels the other is being fair, they will often let things go and negotiate easier on repairs which is often the biggest sticking point in transactions.

I have seen many deals fall apart recently due to hardball negotiation by buyers, sellers, and agents.  What buyers need to remember is that this is a very personal transaction to many sellers.  They can be insulted and regardless of how bad the market they will hold it against you.  The original contract negotiation will set the mood for the rest of the process.  One client felt very fortunate to have another offer come in because the original negotiations were strained and they weren’t looking forward to an inspection addendum from the buyer.

Unfortunately the attitudes of the agents can come in to play.  Usually agents are a good buffer between the clients.  We often soften the original reactions and can help keep deals together.  I made a comment that was misinterpreted one time.  I had meant to say that even though it was explained later, it had ticked off the other agent and set the tone.  That deal didn’t come together.

My very basic rules of negotiations? If you are looking for a deal, negotiate hard and don’t get emotionally involved.  Otherwise, whether you are a seller or buyer, negotiate from base of fairness.  They may not agree on your fairness but if the deal doesn’t come together you know where your intentions were.

Other negotiations thoughts?

• I haven’t seen comparables sway anyone in their thinking. Inevitably each side is looking at their own comparables.
• Convince the other side that you cannot go beyond a price for whatever reason.  Either the payoff on your loan or bank approval for the new loan.
• So often people play a Split the Difference Game where whatever the counter offer is the lean to a counter in the middle.  Expect it.
• Give the other side ample time to consider the offer.  Pushing for a quick answer can often lead to a “no”.
• As the seller make sure to give the buyer a couple of days to answer your counter offer.  You might get a better offer in the meantime. It has worked for me.

Those are some basics, can’t give away too much here. Remember, every negotiation is different.  You need to decide if you go for Win-Win or Win-Lose.  Neither are wrong, just depends on you.

photo via http://flickr.com/photos/maveric2003

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