A statement about negotiations - The key to a successful real estate transaction

Editors note: Today’s post marks the beginning of a new and improved Dear Monty. With the launch of PropBox.co, a company in which I have a financial interest, the messages from Dear Monty are changing. In the past, the tagline on the column read No Nonsense Real Estate Advice. I started writing the column because while there was some good advice, there was an abundance of real estate advice that needed to be more accurate, true, and clear. Poor real estate advice likely has increased today.

My first article was titled The Rules of the Real Estate Game. It was published on May 30, 2011. My advice, for the most part, remains accurate. What is changing is that I am no longer giving advice. I am now providing options with the pros and cons of each option. Every state requires real estate agents to provide options as well. It is a major part of treating one’s customers and clients fairly. For this writer, options require considerably more thought. Instead of zeroing in on one view, considering the most likely alternate possibilities and the advantages and disadvantages of each is time-consuming and creates more to write about. From the reader’s point of view, having options with pros and cons will likely lead them to the best decisions.

Negotiations are an important key

Being informed is the best tool you can use during negotiations. Knowledge about the home’s condition, the range of value, and the many other aspects that affect value will be helpful to your ability to negotiate with confidence. In addition to information regarding the home’s features and value, you must be aware of and consider your emotional and financial situation. So many times, I have seen ego, misinformation, or stubbornness unnecessarily cost a sale. In most cases, one or both parties were not willing to consider the concern or objection of the other party. You discuss and decide on the critical concerns during the real estate negotiation. Because both buyer and seller have different needs and priorities, negotiations can sometimes become emotionally frustrating and confusing. The best way to negotiate is to create a fair “win-win” agreement between buyer and seller.


Seek to understand – then be understood

To understand the negotiating process, you should first appreciate the impact of different interest levels or motivations—these differences, whether large or small, can create a stressful environment for everyone involved. PropBox sellers and buyers are both demonstrating a desire to work together just by joining the program. Your effort in gaining critical knowledge about the other party’s concerns will help guide you through this vital step.


The advantage of working directly together

When no intermediary is involved, two parties negotiate directly instead of four, reducing the chance of miscommunication. For example, when you want to make an appointment to see the house, you message the seller while viewing the home on your computer screen. The seller is notified and promptly messages you back. Otherwise, it can take a day or two to make that appointment. PropBox is the only advertising real estate platform where the seller and buyer communicate directly inside the venue. When PropBox brings qualified buyers and sellers together, they have the same goal – to complete the transaction successfully.  



At this stage of the game, many considerations and possible apprehensions occupy the minds of both buyer and seller. Here is an insightful look at what they are thinking.


• Why are they selling?

• How was the price determined?

• Have they had other offers?

• How long has the home been for sale?

• Will they come down on their price?

• Should I act firm or non-committal about my offer?

• How can I start lower than asking but not so low as to upset them?

• Will my financing contingency, or occupancy needs, affect my ability to negotiate?

• When should I introduce other aspects like poor condition/ slow market/etcetera that affect the price?


• How serious is their interest?

• How was their offering price determined?

• Have they made other offers?

• How long have they been looking?

• Will they go up on their offer?

• How long should I wait to lower my asking price/ if at all?

• If I get a full-price offer within the first week or two, did I “undersell” my home?

• Can they acquire financing?

• Do they have enough earnest money?

• How urgent is the time of occupancy to me?


The answers to these and many other questions depend upon your circumstances. Your best negotiating results will occur if you have accurate, timely information to answer your questions and to help you understand the other party’s position. Ask yourself these questions and relate them to the negotiation. PropBox automatically shares information transparently to create an open negotiation process that simplifies, clarifies, and adds trust to the negotiation.


Be a good listener and don’t depend on others to understand

Our belief about negotiating is to be informed. For example, understanding the other party’s position and the home’s value range improves your chance of succeeding. You will be less likely to get stuck on an unacceptable price because the seller and PropBox remove a major barrier to success. The goal is to bring the buyer and seller together to reach a fair agreement.