Are you prepared to negotiate the best possible deal for your clients? If so, you must be able to control the offer presentation process.
In previous columns, I illustrated how asking powerful closing questions can help you overcome most buyer and seller objections. The goal is to avoid being placed in a defensive position by your client’s questions or objections. Asking questions puts the ball back in your client’s court rather than requiring you to defend your position.
Negotiating offers is one of the most important jobs that most agents are supposed to do, yet many agents turn this important function over to their fax machine. It’s certainly much easier to fax the offer to the listing agent and then let that agent present the offer to the seller. The challenge is that the listing agent has a fiduciary duty to help the seller obtain the highest possible price.
In other words, the listing agent’s job is to obtain as many concessions as possible from your buyers. If you are not personally presenting your offers, you are depriving your buyers of the representation they need to obtain the best possible deal for them.
Agents who do not negotiate face-to-face miss important nonverbal cues that can help them determine where the opportunities are to gain more concessions from the other party. Equally important, the seller’s body language will also let you know which points are negotiable and which points are deal-breakers.
Here are some of the objections you may hear when negotiating an offer as well as the powerful closing questions that will assist you in meeting them.
1. Fifty percent of asking price? Are you serious? Our house is priced to sell. You can leave right now!
Agent: "Mr. and Mrs. Seller, I would have liked nothing better than to have brought you a full-price offer. That would have made my job much easier. My buyers, however, have elected to write an offer that is substantially under your asking price. About half the time agents can actually put these transactions together. If you don’t write a counteroffer, you definitely won’t sell.
"Consequently, you have an important decision to make. You can write a counteroffer and see if this is one of the 50 percent that will close. You can also elect not to write a counteroffer and continue to stay on the market. It’s your choice; what would you like to do?"
Here are some important points to note. First, never say anything disparaging about anyone involved in the transaction. While it may be tempting to call the buyers "lowballers" or "bottom-feeders," these names actually make it much more difficult to close the transaction.
Instead, the phrase "substantially under the asking price" states the situation without making any judgments about the buyers or their agent. As an agent, your role is to calm the situation rather than adding to the stress that’s already present.
Second, many buyers today feel pressure to make a low offer because there is so much press about all the distressed properties that are available. Consequently, the buyers may be testing the water and perhaps may be willing to offer more. If you don’t obtain a counteroffer, the deal is definitely dead.
By encouraging the sellers to make a counteroffer, even if it’s at full price, you at least have one more opportunity to put the transaction together.
2. We want the big-screen TV (or some other appliance or fixture).
When you’re writing an offer, there is nothing wrong with the buyers asking for everything they want. The same is true when the seller makes their first counteroffer. As one mega-producer put it, "The first offer is what the buyers would like. The first seller counteroffer is what the sellers would like. My job as an agent is to bring the two parties together."
When the buyers ask for something not included in the list price, they may legitimately want the item or sometimes it’s just a negotiation ploy. In fact, some shrewd negotiators deliberately make requests for items they don’t want or need just to use them as concessions they can offer during the negotiation.
For example, if the parties are $5,000 apart, the sellers might agree to include the appliances to sweeten the deal. The effect is the buyers feel as if they gained a concession and the sellers obtained the dollar amount that they wanted.
When it comes to controlling the negotiation situation, remember this simple rule: Question, question, question! Outline your clients’ options and ask which strategy works best for them. Most important, if you have clients who are being unrealistic, sometimes the most powerful way to control the negotiation is to walk away.
Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, trainer and author of "Real Estate Dough: Your Recipe for Real Estate Success" and other books. You can reach her at Bernice@RealEstateCoach.com and find her on Twitter: @bross.
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