Real Estate Fundamentals: Rule 2, You Have to Negotiate
- Topics:
- Market Studies
- Tags:
- Business Operations,
- Finance,
- Free Trade,
- Real Estate,
- Transaction,
- Values
- Source:
- Financial Planning Association
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Overview: Many financial planners believe they are good negotiator. Negotiations play a critical role in the purchase and sale of real estate. One can leave huge amounts of money on the table without even knowing it if one lacks negotiating skills. Current theories espouse the value of so-called "win-win" strategies; however, these strategies are often ignored in favor of a more confrontational approach. Sellers typically price properties above what they hope to obtain and buyers usually offer less than they are willing to pay, thus setting the stage for old-style positional bargaining. This process can deteriorate into a test of wills and egos with the economics of the transaction lost by both parties. Values are relative. Matching the benefits offered by a property to the needs of a buyer is often more important than negotiating the best possible price. Many financially beneficial transactions do not occur for reasons that are not readily apparent. Most sellers want the opportunity to correct the situation before the contract is terminated. In complex transactions, negotiations may continue right up to the closing table and some deals may even fall apart at the closing table. While more simple transactions may not be extremely difficult to negotiate, most deals contain at least some opportunities for an improved outcome for clients.
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Format: HTML | Date: Jan 2003 | Pages: 1
