Negotiation Skills to Seal the Deal

1. Negotiation Skills to Seal the Deal Bruce Hardie

2. Bruce Hardie • Agent and Operating Principal, Spokane, WA • Investor: Anchorage, AK • Area Director for Northwest Region • KWU International Master Faculty Negotiation Skills to Seal the Deal

3. Please complete an evaluation formfound in the back of your program guide. Negotiation Skills to Seal the Deal

4. Negotiation Skills to Seal the Deal Main Ideas • High demand for good negotiators • Negotiation: not just about price • The three Ps of negotiation • Negotiations and personality types • Tactics and countertactics • Busting common deal-busters Negotiation Skills to Seal the Deal

5. Meet the Demand Negotiation Skills to Seal the Deal What buyers want most from their agent: • Negotiations rank second only to “help finding a home.” (2013 National Association of Realtors’ Survey of Buyers and Sellers) • Why do you want negotiation skills? • Your contracts are more likely to close.

6. Common Points of Negotiation Price • Sales price is the primary factor in negotiations. • Not necessarily the bottom line. Terms • The terms may be financial or timebased. • Offer terms matter most when: • The buyer and seller disagree on price. • The seller receives multiple offers of same price. Negotiation Skills to Seal the Deal

7. Common Points of Negotiation Terms • Closing costs • Closing date • Conveyances • Earnest money and option fee • Repairs Note • Negotiation happens twice—in the offer stage and in the options period. Negotiation Skills to Seal the Deal

8. Critical Elements of Negotiation • Power • Information • Time Negotiation Skills to Seal the Deal

9. Critical Elements of Negotiation Negotiation Skills to Seal the Deal Power—understanding it and gaining it • Power is possibly the most important element. In any negotiation • One person is controlling (has power). • One person is being controlled (no power). • There are eight types of power.

10. Critical Elements of Negotiation Eight Types of Power Negotiation Skills to Seal the Deal

11. Critical Elements of Negotiation Information • Information = Power • When gathering information … • Ask open-ended questions. • Keep repeating the question. • Question other people. • Bring an expert. • Carefully select the negotiation location. • Shop around. Negotiation Skills to Seal the Deal

12. Critical Elements of Negotiation Time • Flexibility and concessions come with pressure and time. • Higher pressure = worse outcome in negotiations. • 80 percent of concessions occur in the last 20 percent of negotiation time. Negotiation Skills to Seal the Deal

13. The Three Ps Approach Negotiation Skills to Seal the Deal

14. The Three Ps: Prepare Preparation builds confidence and ensures a smooth process. • Learn the regulations. • State and local laws regulating zoning, mortgage qualification, etc. • Your local Board of Realtors’ governing forms • Get familiar with what belongs in each field Negotiation Skills to Seal the Deal

15. The Three Ps: Prepare Negotiation Skills to Seal the Deal Think and act strategically and be informed. Know your goal—a win-win agreement • Know your client’s goals—what’s negotiable and what stands firm? • Learn about the other party and anticipate their actions. • Set clear expectations with your client • Always underpromiseand overdeliver

16. The Three Ps: Present Commence negotiation. • Call the co-op agent to alert them of the offer. • Invite them to view the offer through eEdge. • If in-person, pay attention to nonverbal cues. • Keep quiet once you present an offer. • Hear what the other party reveals when you let them talk. • Focus on the customer’s needs. Negotiation Skills to Seal the Deal

17. The Three Ps: Present Negotiation Skills to Seal the Deal Commence negotiation. (cont.) • Write down what matters to the other party. • This demonstrates you’re taking them seriously • Stay calm and relaxed. • Either party may react with strong emotion • Be a calming influence • Keep your emotions out of it • Know different cultural negotiation norms.

18. The Three Ps: Present Negotiation Skills to Seal the Deal Body language • Positive nonverbal cues • Open gestures (nodding, sitting back, open palms) • May indicate agreement, understanding, interest • Negative nonverbal cues • Closed gestures (crossed arms, lack of eye contact) • May indicate disagreement or disinterest

19. The Three Ps: Present Negotiation Skills to Seal the Deal Phone language • Positive verbal cues • Upbeat, emphatic, varied tones, and a swift pace of speech • Negative verbal cues • A monotone, flat voice, a loud tone, and an abrupt or especially slow speed

20. The Three Ps: Position Negotiation Skills to Seal the Deal Move parties closer to each other. • Acknowledge the common ground. • Where are the buyer and seller in agreement? • Identify which positions may be adjusted. • Identify which positions are set in stone. • Ask “what” and “how” questions. • What are the other party’s values? • Why are some things important to them?

21. The Three Ps: Position Negotiation Skills to Seal the Deal • Positioning is a process. • Be willing to leave and come back to the table. • Sometimes several counteroffers will be necessary to reach an agreement.

22. Negotiations and Personality Types Success requires: • Understanding personality types and styles • Adapting negotiation tactics to personality types and styles Negotiation Skills to Seal the Deal

23. Negotiations and Personality Types Negotiation types and styles based on personality: Negotiation Skills to Seal the Deal

24. Negotiations and Personality Types Pragmatic (D) • Street fighters • Go for what they want • Certain there are winners and losers • Want to win • Fight hard and see little need for concessions • Negotiation challenge: Hold a fixed position Negotiation Skills to Seal the Deal

25. Negotiations and Personality Types Negotiation Skills to Seal the Deal • Extroverted (I) • Enthusiastic, often overly so • Loses sight that others are not as enthusiastic • Negotiation challenge: Often ignores feelings of others in negotiation

26. Negotiations and Personality Types Amiable (S) • Pacifiers • Goal is to make everyone happy, not necessarily win the negotiation • Dread high-pressure encounters • Long for a solution, even if it doesn’t meet their requirements • Negotiation challenge: Easily swayed Negotiation Skills to Seal the Deal

27. Negotiations and Personality Types Analytical (C) • An executive by nature • Rigid in negotiation • Reluctant to be flexible • Precise on the details • Concerned with the underlying principlesof any issue • Negotiation challenge: Inflexibility Negotiation Skills to Seal the Deal

28. Tactics and Countertactics • We’ll review twenty-four tactics and countertactics. • It’s important to know them and how to respond when they’re being used on you. • Use the appropriate tactic/countertactic based on the situation and personality type of the other player(s). Negotiation Skills to Seal the Deal

29. Tactics and Countertactics Nibbling Hot potato Higher authority Set-aside gambit Mediator Never taking the first offer Negotiation Skills to Seal the Deal

30. Tactics and Countertactics Good guy/Bad guy Feel, felt, found Smart/Dumb Service value Walk away Flinching Negotiation Skills to Seal the Deal

31. Tactics and Countertactics Trade-off principle Vise technique Power of the printed word Withdraw offer principle Easy acceptance Funny money Negotiation Skills to Seal the Deal

32. Tactics and Countertactics Decoy technique Red herring Puppy-dog close Reluctant buyer Want-it-all philosophy Splitting the difference Negotiation Skills to Seal the Deal

33. Top Agent Negotiation Tips From Dianna Kokoszka, CEO, KW MAPS & KWU • Don’t tell too much. • Stay quiet about your client’s motivation. • Don’t be attached to the outcome. • There is no way you can win every contract. • If a deal doesn’t go through, look ahead and go find the win for that client someplace else. Negotiation Skills to Seal the Deal

34. The Most Common Deal-Busters • Unexpected findings in inspection reports • Appraisals that don’t support the price or loan or don’t match the CMA • Delays/Problems with loan approval/funding • Contingencies that hold up the sale • Co-op agent failures • Poor communication, attention to detail, vendor selection • Missed deadlines Negotiation Skills to Seal the Deal

35. Preventing Deal-Busters Greatly increase your chances of closing. • Gather information. • Address common concerns before they arise. • Have good solutions and scripts. • Stay in frequent contact. • Maintain awareness of situation dynamics. • Keep a close watch on every step toward closing. Negotiation Skills to Seal the Deal

36. Ideas into Action Prepare and practice negotiation scripts. Attend Market Center negotiation training. Observe personality types. Study the most common negotiation tactics and countertactics. Anticipate common deal-busters. Be proactive and aware without getting emotionally involved. Negotiation Skills to Seal the Deal

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