Negotiating to make a major purchase of any kind takes far more than a good “feel” for bargaining. It takes some real skill on your part. Knowing the strategies that work best with sellers can position you to get the best possible deal on a real estate purchase or in any other transaction. Here’s a look at some techniques you can employ to make a successful purchase.
Going, Going, Gone
Sellers must appreciate that you will not wait forever on them. You must assert your position that you have other options, and if they won’t go any further to make a deal with you, you’ll take your money elsewhere. There’s a lovely place over here that you like, or your co-worker’s friend is selling something similar, and so on. This is a very effective option – assuming you do have somewhere else to take your money and that you will actually do it.
Good Cop, Bad Cop
It’s often very effective to negotiate with a partner in tow, whether it’s your significant other, a sibling, or even just a friend who give off an aura of financial savvy. What may work best is to keep that person at a distance until you reach a pinch point in negotiations, then tell the seller you want to run the deal by someone for some moving house financial advice, for example. This will spook a seller who is trying to take advantage of you by suggesting that a more qualified person is about to catch them in the act, and it can be just the right nudge to get you across the finish line.
Dropping Anchor
You should always negotiate with a maximum purchase price in mind, and it’s often helpful to come right out of the gate with a (purportedly) hard and fast top price that lingers somewhere below your real maximum. Approach the seller with this working figure, with the implication that you simply will not go beyond it. This will anchor you at that level and shift pressure to the seller to stay under that figure. As negotiations continue, read the seller’s reactions to your figure. It may be necessary to ease upward from your stated maximum toward your real maximum, but don’t do it quietly. It never hurts to do a little moaning and groaning in agreeing to go a little over that figure. Just don’t show that card until you absolutely must. Have two amounts in mind: your negotiating ceiling and your real ceiling and be prepared to hold your ground with both.
Secure Your Emotions
Buying something is a financial decision, but wanting it is an emotional decision. The former is a conversation with the seller, while the latter is a conversation for yourself to have with a partner, business associate, or other ally. The minute you let a seller get into the emotional side of your decision, the tougher it is to maintain your position. If the house reminds you of your childhood home, don’t surrender that bit of intelligence. Convert the emotional value of that connection into its financial value prior to negotiations and decide how much more that home is worth to you based on that emotional quality. In short, keep the process financial in nature, not emotional.Striking a deal to buy anything is a real art, but it must be developed as a skill. Learning to incorporate strategies like these will fill your quiver with some sharp arrows that will really help you develop a strong position in any negotiation.
