Australian Property Investor Magazine: Negotiate like a pro by Kieran Clair Boucher January 2015 Issue
API has wrangled a herd of property doyens and asked how the regular investor can minimise their purchase price.
If you’ve ever found yourself in the negotiation process wishing you had an experienced voice in your ear full of good advice, you’re in luck. We’ve asked five of the most respected voices in property investment what they do during negotiations to achieve the best result. As you’ll see, some of the lines cross, but it’s all gold for purchasers.
Director, Property Pursuit Buyer’s Agents
Knowledge is power. Gather your data, analyse recent comparable sales and arm yourself with relevant information to support your offer price. If you know the market really well and can discuss the superior and inferior aspects of comparable properties that have sold recently, then you place yourself in a strong position.
Nice guys finish first. Be courteous and professional towards the agent and seller. The quickest way to lose ground in a negotiation is to offend the other party. The agent is your ‘portal’ to the owner and they’re the owner’s professional representative so don’t get them offside as they’ll help you understand the seller’s motivations for selling. At the same time, don’t forget that they’re representing the seller’s interest and their fiduciary duty is to obtain the highest sale price on the owner’s behalf.
Use your head. Don’t treat a residential property negotiation like a business negotiation. The owners are people with feelings, emotions and motivations. The most important part of putting a deal together is to understand these emotions and motivations and structure a proposal that best meets the seller’s non-monetary motivation. Quick settlements, long settlements and rent backs are some examples of meeting a seller’s needs without increasing your offer.