Negotiating Strategy

Just selling your home isn’t enough. You deserve every last dollar of your equity.

All Negotiators are Not Created Equal

No two agents are likely to negotiate the same price for your home. How is this possible? Isn’t your home worth a specific price?

The value of your home is determined by what an informed buyer is willing to pay. We can affect that amount by demonstrating the value-added amenities your home offers over the competition.

Yours is not just like the house next door.

How Not to Value a Home

The good news and bad news is most home buyers don’t understand how to determine the value of a home.

Many buyers are overly simplistic in their approach, and they start and end with “cost per square foot”. Sadly, a lot of agents don’t know how to do much more than that, either. Rarely if ever does a cost-per-square-foot analysis result in a value anywhere even close to market value for a particular home.

“Cost-Per-Square-Foot” Analysis Broken Down

Example: Two homes with the same floor plan, therefore same square footage, just sold on the same street. One has been remodeled  and has a beautiful swimming pool, while the other is in original condition and doesn’t have a pool. These very different homes don’t sell for the same price, and they don’t have a remotely similar cost per square foot. It’s a simple concept, but one that home buyers don’t always grasp until it’s explained.

Home buyers spend a lot of time comparing homes on paper. They have lists of homes to look at and lists of recent sales, and the cost-per-square-foot data is readily available. These well-intentioned but misguided nice people just tend to forget that there is more to each home than what is in print. Homes are all unique in location, condition and amenities.

How Does the Home Seller Arrive at Market Value?

Some home sellers (not you) have a net figure in mind that they need to get, so that is the value they place on their home. Maybe they are moving somewhere expensive, like San Francisco, so they “need more” than if they were moving to…Ohio. (You’d be surprised at how often this logic is used, but that’s another story.) Also, most home sellers don’t use the cost-per-square-foot approach because they tend not to compare their home to other homes. At all.

So How Do We Reach Agreement on Price?

That’s where negotiation skill comes in handy. Besides being able to communicate effectively in any of the four basic negotiation styles, a good negotiator knows how to determine what’s important–and unimportant–to both sides. It’s also essential to keep emotions under control. No one makes good decisions when they are emotional–and this is a common state for both home buyers and home sellers–pretty much throughout the process. A skilled negotiator is the calming influence in every transaction.

Once emotions are in check, if a buyer is convinced that the value you’ve placed on your home is well-supported, we will come to terms on price. The buyer will not meet your price simply because you need or want a certain amount of money. This, unfortunately, is the “strategy” used by many of our colleagues during the negotiation process. The problem with it is that the buyer doesn’t care what the seller “needs”, so the sale doesn’t happen.

A buyer who loves your home (that particular emotion is OK) really wants to buy it, deep down. They don’t want to overpay, but if it can be demonstrated that your price is fair, they will want to pay it because that means they get to own your beautiful home.

We approach the buyer on his terms. He cares about value. We prove to him that your price represents a fair value. It takes a little more time and some expertise, but we think it’s worth it. We think you’re worth it. Put us to work and let us earn your money.

If you’re ready to take the next step, feel free to contact us. Or you could read about Selling Your Home for the Highest Possible Price, Selling Your Home in the Shortest Possible Time, Selling Your Home with the Least Amount of Stress. We’ll be here.

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