Prepare For Buyer Negotiation Tactics
Negotiations Are Like First Dates, Be Mysterious but Keep Them Engaged
Giving and taking are not the only aspects of negotiation. In other words, it’s the ability to come up with an agreement that everyone will be satisfied with whether an offer is accepted or not that can make all the difference in whether a deal is successful. Here are some common tactics buyers use when negotiating with sellers that you should be aware of.
Negotiating Your Home Sale: How to Prepare
Some common buyer negotiation tactics can be addressed by taking some steps. Being prepared is key.
Make sure your home is in top condition so the buyer will not have any significant objections.
These objections can be overcome with a home warranty. In addition to bringing peace of mind, it also serves as a powerful marketing tool.
Find out what motivates and pressures the buyer (if possible).
In this way, you will be able to determine how to appeal to them and keep your top priorities in mind. On the flip side, don’t disclose your own motivations or pressures.
You should be able to support your asking price with recent local sales.
It is recommended that you have your home appraised before you start the selling process. Your home can be priced slightly higher than its appraisal in a strong or rising market. You should prepare for all the omissions you feel the appraiser missed when you are asking for a low price in a weak market. Your appraisal can help support your position on price when you enter negotiations with a buyer who does not see the value.
Prepare a presentation in advance.
This helps you be ready to handle the typical “buyer tactics” discussed below. You know your home better than any buyer’s agent out there. Use this to your advantage.
Take a step back if you need to.
It is important to be prepared to reject undesirable offers or situations when selling your home. A counteroffer is always an option, and we will explore it in more detail below.
Stay up-to-date on mortgage rates and lending trends.
What’s the reason? Understanding the lending conditions your buyer faces will help you understand what factors your buyer can alter and what factors both of you need to address.
The following guide to negotiating home prices may also be helpful in preparing you.
Tactics used by buyers to negotiate
In this method, the property is inspected or the contract is reviewed by a third party before closing takes place. The following are common examples:
- “I would like to see the home with my parents before they give us the down payment.”
- “The contract needs to be reviewed by my attorney.”
This is a last-ditch effort to lower the price. When dealing with this tactic, ask before setting up a negotiation appointment, “Who else would you like to be present when we finalize the details?”
The nibblers
This is a group of non-stop negotiators. Nickel-diming is sometimes used to describe this. Avoid nibblers by thoroughly documenting all the details and items you previously agreed to. The sale should include everything that is included in the listing. Deals are deals, no matter what. Changes they want to make create a counteroffer, which you do not have to accept, and they may lose their purchase. Ensure that you inform buyers that their counteroffers must be in writing and that you may or may not accept them. Often this will stop nibbling. Additionally, you can use WINCE and SILENCE.
The good guy and the bad guy
There are many similarities between this situation and the tactic of higher authority. Using this tactic, you have to have the good/bad teams in separate locations so that the bad guy cannot interfere with your plans. A resolution to this situation would be to schedule an appointment that is convenient for all parties involved. Unless everyone is present, don’t negotiate unless joint consensus is required.
Wouldjatake
Usually, this is a sudden statement blurted out by the buyer – a “trial close” to catch you off guard and confirm a deal that favors the buyer. A good response to “wouldjatake” is: “If you present me with a written offer, I will consider it.” This response diffuses the situation instantly and gives you time to think about what to do.
‘Trial Balloon’
You can use trial balloons to assess your position without revealing what your counterpart believes. The purpose of these questions is essential to gain information without committing to anything. You might feel compelled to answer a trial balloon question thoroughly when you receive one. Respond with another question if you are resisting. When asked, “Would you consider financing the house yourself?” In that case, what would your offer be?” As a buyer who cannot qualify for conventional financing or pay cash, you should expect a higher offer from them.
Sellers’ Negotiation Advice
You can smooth the home sale negotiation process by keeping these thoughts in mind.
Make sure the price is fair at the beginning
This immediately removes one of the main points of contention. There must be a reasonable and fair counteroffer afterwards. Be respectful of the buyer’s concerns. If you know and respect items of particular significance to the buyer, you may be able to strengthen your own positioning.
Prepare yourself for compromise.
The deal could be ruined if you try to win every point. It is likely that both parties will walk away from the agreement “relatively” satisfied.
Ignore minor issues. Putting minor issues aside and completing the main agreement will resolve them. Minor issues will become easier to resolve after the main agreement has been completed.
Choose the right option for you
Any offer you receive as a seller can be accepted or countered.
- If you don’t want to accept the full price, you can decline it. It is possible for sellers to decline any offer, whether it is the full asking price or above. The most common reason to do this is when you receive an offer that is higher but less desirable (e.g., FHA rather than conventional).
- Any offer can be countered. Alternatively, you can increase your asking price as a counteroffer. The situation occurs most often when one bid (full price) is better than another in a multiple-bid situation. Remember that all counter offers (which should always be in writing) decline/rejections with a new offer. As a result, the original offer and counteroffer are void, and the offer/counteroffer maker is no longer obligated to accept them.
- Counteroffers can be withdrawn. Counteroffers may be withdrawn by the seller until the buyer’s accepted offer is delivered. It is crucial that the buyer’s agent delivers the signed offer to you so that it can be considered binding. Withdrawal may be possible if this has not yet taken place.
A guide to negotiating when selling a home
You can use the following strategies to negotiate the price of your home.
Silence
It is possible for you to use silence to your advantage when used strategically. Sit back and wait if you have set your price and you’ve yet to receive a response. It is uncomfortable for most people when a conversation ends. If you are ambiguous on your price, the buyer (and their agent) will be expecting it. You don’t have to say anything! When you use this tactic, your counterparts will almost always begin to whittle away at their position. Your price should have been predisposed to being backed off or qualified by the buyer. When they perceive that you mean business by your silence, you’ll see the discomfort in their body language.
It is also important for buyers to understand the importance of silence. Simply restate your price after a few long moments. Keep your suggestions and concessions to yourself. You only need to repeat your terms. A concession is more often than not made as a result of this maneuver since it forces the other person to respond.
The wince
When you wince, you are conveying your negative reaction to something the buyer or their agent suggests without resorting to argument or other negative verbal responses. By doing so, you are letting your counterparts know that you know your limits and that they may be approaching them.
Silence must be your response to the wince. It would weaken your position if you did anything else.
Make sure you practice your techniques
It is important to prepare and practice. You should practice these methods until you feel comfortable using them and are able to recognize when to use them. Watch the results and you’ll be pleasantly surprised. You will be more satisfied with the whole transaction if you practice and prepare well.
When contemplating complex legal matters such as those discussed in this article, it is always a good idea to seek legal advice.