Last week, we explored four negotiation tactics that you should be aware of in Luxury Real Estate.
This week, I want to share with you even more negotiation strategies to keep top of mind.
The Red Herring
This is when somebody makes a really low offer. Then they’ll stick something in the offer to distract you from the really low price. It’s like a big red flag that is designed to distract you from the low price in their office.
The Trial Balloon
Politicians use the trial balloon all the time, but they call it a leak. If people really reacted negatively to the information you give them, they say, “Oh that was a leak and it wasn’t really true.” If people love it, they can say, “Yeah, we were working on that.”
The Low Ball
This is by far, my least favorite negotiation tactic. People do it because they believe it reframes the person’s thinking. My advice to you on low balling is to be appreciative of the offer, thank them for their interest, and get them to move forward by telling them about other offers.
Bait and Switch
This is becoming more prevalent in real estate, especially with cash offers. If you’re going to make an offer, like a cash-like offer, the ethical way to do it is to say, “Listen, I’m gonna make an offer, I am getting a mortgage, but I’m not making my offer contingent on getting a mortgage, because I know I’ll get approved.”
Are You Nuts?
Some people just go nuts. They’ll scream or go into tirades—either in person or on the phone. I try to just take a deep breath and let them vent. Otherwise, I’ll do the silent treatment, which makes them go even more nuts until they just run out of energy.
The Written Word
This is sort of like the limited authority tactic where you pre-print things into your contract. Certain agents or companies in your market place might have their own forms that aren’t standard Realtor Board forms. They’re using their own company forms. Read every form you get very carefully because that’s a great tactic to bury stuff in boilerplate and you want to make sure you’re not taken advantage of.Concentrate on the merits of the negotiation rather than the positions. Click To Tweet
Bottom line: look for the principles that are underlying positions. Why are they doing what they’re doing? What is it they really want to attain? What is their goal? What is their motivation? Look for solutions rather than getting hung up on the tactics.