T.A.P. INTO MY NEGOTIATING TIPS:

During my first years in the real estate business, I worked almost exclusively in the Ellwood market. Here’s what my typical transaction looked like:
– Mrs. Seller has a 100-year old house. We have it listed at $60,000, & it’s being sold “as-is” – flaws & all!
– Mr. Buyer loves the house. He has an FHA loan which means that this is a type of loan that requires the house be in relatively good condition for him to get his financing.
– Even though he has been saving every last penny, he may be about $1,000 short & needs Mrs. Seller to help him with some closing costs.
We have an old house, a picky loan & neither the buyer nor the seller have much financial flexibility. This scenario is peppered with red flags. Many agents… (correction: MOST/THE VAST MAJORITY of agents… ) aren’t willing to get onto that bumpy road that may not lead to the closing table.

A newly-licensed Realtor is totally in over their head here. Even an experienced Realtor who only buys & sells in higher-priced markets, would avoid this transaction like I avoid turtlenecks.

It was being in those exact situations over & over & over again & keeping those deals together that sharpened my negotiation pencil. Here’s some of the ways I counseled my clients to get them through these situations.
We’re going to TAP – T.A.P. – into my top negotiating tips.

1. Terms
2. Approachability
3. Preferences
TERMS:
It seems obvious that you would negotiate on terms. However, you’d be surprised at how many times the ONLY term that Realtors tend to negotiate is price. The agreement of sale, or sales contract, is 14 pages filled with various terms. There are over 800 line items in this contract, & the sales price is only 1 of them.

I recently had a deal that the buyer came in under the asking price by $5,000. My sellers were hell-bent on getting their full asking price, & the buyers were hell-bent on getting $5,000 off. So many other Realtors would have seen this as a stalemate & after going back & forth a couple of times would have encouraged their buyers to move onto another home.
However, by focusing on some other terms – I was able to cinch up the deal.

By suggesting that we move the closing date up by a week, that would help my sellers avoid another month of mortgage payments. By focusing on the closing date rather than the price, this brought the buyers & sellers much closer to what each wanted financially so that we could move forward.
In another recent deal, a seller was hesitant to work with our buyer because he had a VA loan. The seller had heard that this type of loan was likely to entail extra repairs to pass the appraisal. The sellers were trying to negotiate a higher price on the house to offset the cost of this possibility. Our buyer, however, obviously didn’t want to overpay based on something that may not even be a concern.
This could have been the dealbreaker. However, our buyer had previous construction experience so addressing minor repairs without having to hire someone was a massive perk! We shifted our focus away from the price, & came to an agreement. So long as the seller would agree to the buyer’s lower price & give the buyer permission to complete the work himself, the buyer was willing to address the repairs at his own expense.
The price is just one line item, there are many other terms to discuss when negotiating.
APPROACHABILITY:
Is there such a thing as being “too nice to be able to negotiate well?” I’ve received this feedback myself, & it keeps me up at night. If you’re looking for someone to scream into the phone at the other agent to get a deal done – kind of like what you see in the movies (“SHOW ME THE MONEY!!!!”) I’m not that person. I can typically stick to my preferred softer approach.
This approach enhances my success rate. I know that this is because my listing price vs. selling price ratio is an impressive statistic that I share with potential clients looking to hire me. This number is a good indication of how well I negotiate & advocate for my clients to get them what they need & want.
Being approachable is one of the best ways to get people to negotiate well instead of shutting down & backing away. Being approachable is an invitation for brainstorming & collaboration to come up with out-of-the-box ideas to keep a deal together. When other Realtors sense that we have some bumps in the road during a transaction, they know that a phone call to me is going to result in a cooperative effort to troubleshoot & often being able to circumvent an otherwise disastrous issue.
On the other hand, overly aggressive & combative agents also have a reputation. There are many of these agents out there that resort to yelling & bullying… just like in middle school… others don’t look forward to working with them because they don’t ‘play well with others.’

With these agents, each & every conversation is going to be stressful & unproductive. The other Realtor is then forced to try to maneuver through difficult situations alone without having the benefit of insight as to what the other side may be able to offer. If one party feels backed into a corner it grossly increases the probability of a termination.
Being approachable does NOT equal being a pushover. It’s actually a unique trait in our business that is key in fostering ideas & ways forward to mend gaps in the process.
Again, these negotiation tips can be remembered by “TAP”… T… A… P.
1. TERMS include a lot of different things in a contract – much more than just the sales price.
2. An APPROACHABLE Realtor instead of an uncompromising one will help foster communication & cooperative troubleshooting.
PREFERENCES:
That’s our T & A… P stands for Preferences.
Many agents come to me while we’re negotiating with one option, & my clients are asked to agree or disagree to that condition. Instead of a response of yes-or-no, I find much better success when I encourage a “this-or-that” scenario. It gets the other side into the mindset that they get to choose, but we’re controlling each scenario.
I recently had an offer come in on one of my listings. The house was listed at $200,000. The offer came in at $194,000 AND the buyer wanted the seller to pay $4,000 of their closing costs. This means that my clients are essentially coming down almost ten grand in the initial negotiations.
Most agents would reply with something 4 curt words: “$195,000. No seller assist.”
That tells the buyer, “Here are the terms I want. Take it or leave it. Yes or no.”
However, I’d encourage them to keep T.A.P. (Terms/Approachability/Preferences) in mind. Here’s how I would counsel my sellers to respond:

“Thank you so much for such a nice offer, Realtor Lisa. My sellers are really looking forward to working with your buyers. The offer, as it stands, stretches them a little too thin financially. If your buyers are willing to close a week earlier my sellers are willing to either:

– Give your buyers the $4,000 in seller assist, but they would need close to the full asking price at $199k.
OR
– If your buyers don’t need the seller assist, the sellers can come down to $195,000.

Which would work better for them?”
Both of the scenarios work out to net my clients practically the same amount. I included the fact that the sellers would like to bump up the closing date which is a different term that may help them financially without adding directly to the sales price. My response to the agent exudes cooperation & approachability & sets the tone for the rest of the transaction.

T.A.P.’ping into this approach with Terms, Approachability & Preferences goes well beyond negotiating a real estate deal. Use it on kids, the husband, car dealers! Give it a try, & let me know how that works for you!

I’m Always Here & Happy to Help!

Katina Hunter
Team Lead for the Katina Hunter Team with Coldwell Banker
724-888-9020
Katina.Hunter@PittsburghMoves.com