What do you think is the ultimate goal when negotiating a property purchase? Is it that the buyer does everything in his or her power to get the lowest possible price? Or, is it that the seller gives his or her maximum effort to get the highest possible price? Or, is it none of these answers?
One day, a retired multimillionaire businessman told us what he missed the most about negotiating. His greatest satisfaction was to conclude an agreement where both parties were content. That is exactly what property buyers and sellers should aim for: closing a win-win negotiation.
It is useless for buyers to push sellers against the wall and force them to give up their property for an unsuitable price. This attitude rarely leads to good results. Conscientious buyers not only think about their own interests, but they also think about the sellers’ satisfaction.
The buyer who decides to offer a ridiculously low price from the beginning insults the seller. Worse, it humiliates him or her. On the contrary, if the seller is asking for an incredibly high price from the start, it will offend the buyer. No one wants to feel exploited.
Negotiating the price of a property is above all an exchange of information. It is not intended to be a show of force or a tug of war. Neither the buyer nor the seller should feel like they are being interrogated by a police officer.
Negotiations must take place in a climate of mutual trust. The initial eye contact is very important. It is often a good idea to talk about a subject that has little to do with the property. Take the time to get to know each other and create a business relationship.
To create a friendly climate, the diplomatic buyer could draw the seller’s attention to a home accessory: the painting hanging on the wall, the eclectic furniture, the car in the parking lot or the computer system, provided he or she has knowledge of the matter. The diplomatic seller should act in the same way.
The common belief is that if you have just shared a nice meal with someone with whom you have had a good conversation, face to face, you are less likely to disappoint that person. The same is true for the property buyer and seller.
Buyers and sellers who aim for the win-win formula should make a point, during the negotiations, to ask each other what would make them happy. This is not a sign of weakness, far from it. It is rather a mark of civility. There is always a way to get along to smooth out the differences.
Buyers and sellers should insist on rewriting their demands, as needed, to clarify any misunderstanding that could undermine the negotiations. This attitude preserves the atmosphere of mutual trust and leads to an agreement that is profitable for both parties.
That being said, do not be too charitable. Otherwise, words and gestures may seem fake. Flattery is another trap to avoid. Nobody wants to feel like the crow in the tree watching the cunning fox steal his piece of cheese.
Does the seller seem worried or impatient? Maybe he or she has had an unpleasant experience with the buyer before you. So, take the time to reassure the seller by showing him or her that you are serious. Maybe he or she will agree to lower the asking price. Who knows?
Follow the advice of your broker. He or she is there to make sure that the negotiations are conducted in mutual respect and understanding.