The Real Estate “X” Factor

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March 25, 2015 by Jeff Lowen

When it comes to the laws of basic science, take gravity for example… It’s a given that that any two bodies in the universe attract each other with a force that is directly proportional to the product of their masses and inversely proportional to the square of the distance between them. Thank you Sir Isaac Newton!

I wonder who helped Mr. Newton buy his first home back in 1687? 🙂 A little known fact from that era was that a gentleman known as Robert Hooke, claimed Newton pilfered some of the very details that make up his law of gravitation just a year earlier.

Let the negotiation begin.

As in life, so as in real estate, anytime you’re nose to nose and toe to toe with another person, you’re negotiating. Yes, perhaps the term has a negative connotation, but it’s not just for game wardens and police chiefs. Top real estate agents will tell you that this is in fact an “X” factor. One that is incredibly overlooked by many. Not only can real estate deals be won and lost over it, but to the degree you increase your bottom line, if you’re a seller; and how great a bargain you get on that dream home, if you’re a buyer can equate to tens of thousands of dollars in either direction.

The last time you bought or sold a house, did you ask your real estate agent about their skills in the negotiation arena? And how that would equal dollars gained or lost based on their skill set? What are good answers to these questions?  Many people would take it upon themselves to do a little research, e.g; speak with professor Google. Then, they satisfy their curiosity from an article about top negotiating tips or rules from a trulia or zillow contributor that’s never seen the outside of a classroom.

However, the truth of the matter is – that you can learn a few tips from everyone from an undergrad journalist to your neighbor to some of the more successful entrepreneurs; at the end of the day, practical application is what counts. How good are you at recognizing when someone is using a particular “tactic” against you and do you know the counter tactic to diffuse it so you don’t end up giving up the farm? How well can you remain calm when everything around you is falling apart?

Example: I’ve been involved in real estate transactions where a seller is a licensed agent that wants to represent themselves. And because they are so close to it emotionally, their stubbornness not to be represented causes them to lose the very commission they hoped to save by doing so. Emotion. Just one aspect of negotiation, albeit a huge one. Especially at the residential level.

So what’s all this mean to you and me in the real world (Before this article becomes a novel)? It’s easy to get mesmerized by statistics, knowing the area, years in the business, company history, or any of the countless attributes that may be important and contribute to a starting point, but in the long run – How adept at handling every situation proactively, very aware of the fragile and sometimes volatile emotional roller coaster a real estate transaction can be and what to do about it so that everyone can feel good about moving forward is ALL about negotiation.

Tell me if you’ve heard of any of these:

The flinch.

Good guy, bad guy.

Hot potato.

The red herring.

Time pressure.

The walk away.

These are a few, what good negotiators call “Tactics” or “Gambits.” Simply, a maneuver for advantage. It’s important to know them only because they are being used on you all the time. Even if the person using it isn’t aware that’s what they’re doing!

Doesn’t it make sense that we spend a little time learning some of these “gambits” so that when the time comes that we’re faced with the potential of who absorbs the tens of thousands of dollars in unnecessary expenses, we are able to work a fair solution for everyone involved? Of course it does!

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