The following information is provided by the Center for REALTORÂ® Development, with assistance from Lauren Hampton and the Podfly editorial team.
Negotiations are a crucial part of all real estate transactions. Improving your negotiating skills is this month’s CRD podcast topic. Darren Kittleson joins our host Monica Neubauer for episode 6 to define what a win-win transaction looks likeâ€”and how to achieve one.
Guest Darren Kittleson has been in the real estate industry since 1994. He is the operating principal of two Keller Williams offices in Madison, Wis. In addition to his work as an agent, he has participated in association leadership, and serves as a trainer, speaker, and coach for real estate agents across the nation.
Approach Negotiations Like a Child
Kittleson begins the conversation by pointing out that we negotiate far more often in our lives than we realize. As kids, this is something many people do naturally, but somewhere along the line, we lose that natural ability, or it is “trained” out of us.
But approaching negotiation with the attitude and wonder of a child may lead to surprising outcomes, and allows you to hone your skills as a professional negotiator.
“Go back and approach negotiation with the attitude of a four or five year old; you’ll be surprised at the outcomes you get,” says Kittleson. Like a child, just ask! The worst thing that can happen is someone says no.
Darren suggests negotiating on a daily basis to practice the skill, so it’s there when you need it in a real estate transaction.
Strive for the Win-Win
Negotiations are not always about price. There are other terms and conditions that can be negotiated to get the best outcome for your client. Some of these include the timing of the sale, and making sure the right offer will close or appraise. Kittleson refers to these as strategies of the transactionâ€”and urges you to make sure that as a REALTORÂ®, you consider all the factors that could help your client.
Most people want to have a win-win situation in real estate transactions. While there are some agents that think they have to have a win-lose outcome, everyone will benefit for future transactions by striving for a win-win. This starts by setting expectations with clientsâ€”letting them know that your goal is to negotiate a win-win, so they understand your discussions and the decisions you make together.
Start the Conversation
As agents, it’s important to be involved with other agents in your market. Building connections and rapport with other real estate agents can help get better outcomes for both sets of clients.
One of the best strategies that an agent has is to get in touch with the agent on the other side before the transaction gets started; they may be able to provide information or terms and conditions that would be helpful to know up front. Knowing everyone’s key terms upfront is helpful, because while they could be a non-issue on your side, they could be the selling point that makes it a win for the other side.
Set Down the Devices
How does technology play into real estate transactions? Kittleson discusses the effectiveness in communication methods. One study showed that the greatest accuracy of feeling and intent comes from body language and tonalityâ€”aspects you can only gauge in a face-to-face or voice-to-voice interaction.
With text or email, there is an archive of what was said or what exchanges were made. This can be a benefit or a disadvantage, depending on the situation. With access to only the words, however, you may not get the full meaning behind the message. Communicating voice-to-voice will be more effective in setting up the relationship for a win-win transaction.
Educate your clients right from the start! Proactively setting the stage for negotiations from the beginning can make a transaction much smoother, because people will know what to expect. The education process should continue throughout the transaction, and it’s important to take the opportunity to have teachable moments. As agents, you can be more effective if your client is educated and aware of what is going on in the negotiation. This can help grow your own business if your clients refer you to their friends or family.
Our monthly podcast focuses on education in the real estate industry. It addresses formal education programs (such as those from NAR) and informal sources of industry knowledge (such as peers and mentors). Its intended audiences include REALTORSÂ®, real estate professionals, allied professions (such as appraisers and lenders), educators, education providers, and consumers. To listen or subscribe, visit www.crdpodcast.com.
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