By Johanna Baker
Real estate is a massive industry in the U.S. In 2018 alone, real estate contributed a whopping $1.15 trillion to the country's gross domestic product. By becoming a REALTOR®, you can effectively tap into this market.
Related: Top 6 Reasons to Hire a Real Estate Agent to Sell Your Home
The job requires you to conduct deft negotiation to convince buyers to part with their hard-earned money. So, if you're looking to hone your skills and boost your professionalism, it's advisable that you take a negotiation class. Here are a few tips about negotiating in the real estate market to support your success right now:
Negotiate in Person
With recent advancements in technology, especially regarding instant messaging, it's not difficult to understand the appeal of negotiating over the phone; however, a downside to not negotiating in person is the absence of body language.
Body language is an essential part of human communication. Seeing and interpreting a customer's body language assists in negotiating better terms. You should consider taking classes on body language interpretations if you haven't already.
Include an Escalation Clause
An escalation clause helps you secure the most value for a property, especially when there are multiple prospective buyers. An escalation clause is where a buyer agrees to pay a fixed amount over the highest offer you receive as long as it doesn't exceed a fixed cap.
For example, let's say Mr. Brown offers $500,000 and signs an escalator of $20,000 with a cap of $750,000. If you get another offer from Ms. Harris for $600,000, Mr. Brown will pay a total of $620,000, which all goes to increase your commission.
Generally, people are more amenable when they feel they're being listened to. So, convincing a prospective buyer to put pen to paper may be as simple as listening attentively.
When you listen, you get to know your customer's needs. Then, you can put forward an offer that matches those needs. If you want to become very effective at making offers, it's important to research and consult with older colleagues for time-tested scripts that are likely to get prospects to become buyers.
Prospective buyers can usually sense when you're desperate. Left unchecked, your desperation can be taken advantage of to push you below your bottom line. It's important that you remain assertive while at the same time being polite and courteous.
In the event that you can't make any more compromises, know when to call off negotiations politely and move on to the next prospective buyer.
Research Your Customer
Business managers are often taught the importance of adequate prior research in negotiation classes. If you want to close more deals more often, it is important to take the time to research your customers. Do your homework on the prospective buyer(s) and be sure to pay attention to a customer's interests and turn-offs. Thorough prior knowledge puts you in control while negotiating, making your customers more open to making a purchase.
As content editor at Negotiation Experts, Johanna Baker is truly passionate about the power of the written word. She believes that through clear, concise writing, content creators have the opportunity to help business professionals develop important new skills that will allow them to grow in their careers.