I have had the good fortune to have completed a number of transactions in the past month. In this current market environment, no deal gets completed without its share of challenges. As I examine the features that seem to be shared by those deals that end at the closing table with good karma still in tact, there seems to be a commonality among — mutual respect. As with most fundamentals in life, it is not rocket science that is needed to develop a positive relationship. In fact, probably just three attributes will resolve in a deal where everyone walks away with a sense of positivity and accomplishment.
- Look both ways. If you speak only from your side of the negotiating table, you will only see half the story and perhaps respond with only half the understanding of the whole issue. Consider the other side’s needs, and see how you can arrive at a solution that will resolve some of their concerns as well as your own.
- Take a breath. Things can get emotional. It will serve you far better to take a break and take a breath during negotiating a rough patch in the deal, then responding from an emotional place.
- Perspective. Buying or selling a house can become (very) stressful. Keep it in its proper place of value in your life. Things normally work out as they should, if you don’t fight the process.
These three elements have, underneath them, the intention of respect for the other party. When this is shared by the other side, nothing becomes an insurmountable issue. Beginning a negotiation (or relationship) with a mindset that values the presence of mutual respect sets a tone and expectation that can take you through anything.
A few years ago I listed a waterfront, ultra high end property. The home was pre-war and although it was fully renovated in the early 2000’s, it was time for another update. Though no one likes extra work, the owners partnered well with me and agreed to edit furnishings (tackled on my end) and clean out closets (handled by them). We came to a list price that was aggressive but not (we thought), ignorant of the current market condition. We had a regular stream of showings but no bid after six months. The owners did not blame me, blame the marketing or blame the brokerage. Together, we reviewed what had been done to promote their property. When I recommended a price reduction and the number that I would go to, the husband said, “That’s actually my bottom line and there is no negotiating room in that number.” I decided in this case, given the uniqueness of the property and house, that we would do better to speak to the market loudly through price, and recommended that we implement my recommendation. There was much discussion before arriving at this decision, as there had been during the initial list price discussion. They were respectful and attentive to my thoughts based on the “in the weeds” of the market experience but also wanted to be sure that we looked at all options carefully. Pricing, and all other discussions, were laced with respect on both sides.
Within three weeks, a buyer came forth. The buyer had been in the market for waterfront for three years, and had known of this property, but felt it was priced too high to even consider, until the final price revision was put into place. The buyer was planning a very large renovation and expansion. He didn’t try to negotiate the price down further when the building inspection revealed a number of replacements needed to mechanical systems and more. He knew it was all going to be changed, anyway. He was logical, practical and respectful to the process and to the sellers.
Getting through building inspections of older homes can be the most challenging part of the transaction process as buyers start seeing every inspection “find” as a possible renegotiation and price reduction point. Reasonableness goes hand in hand with respect. And respect adds an ingredient to the real estate transaction process that is invaluable.