Real Estate Consultant · Greensboro, NC · Member since 2016 · 50 posts · 10 votes
I have been negotiating with a seller, he wants a day to think about the deal. Do I wait longer since he needed time? My offer was 5k less than his asking, he wanted to meet in the middle; Increased my offer by 1500 and he went to shake my hand and then said no he needs to think for a day but would most likely accept (his words) is this a good sign? The house has been listed for awhile but there is an emotional attachment. Any thoughts or comments are welcome.
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
10y
So you've increased your offer by $15,000 and he dropped his asking price by $2,500? You have a lot more to learn about negotiation than worrying if you should wait a day to contact the seller or not.
When you make that big of a move, the other side knows you probably can move some more. You can't go $15,000, then $1,500. He is out-negotiating you and you are on the verge of appearing needy. What you should have done was made your initial offer and when he countered you, you then say that you always put your best offer first because you don't like to play games and get into a bidding war. Then, if you have room, up your offer by just a little just as he has reduced his. In reality, you have much less room than he does. If the property is free and clear, he can go all the way down to zero. You on the other hand have expenses and margins to deal with.
When it comes to negotiating you must always know your "walk away point" and never get wrapped up in doing the deal (thats where you loose time, money, and sometimes gain unwanted problems that you can't afford or don't want to pay). The power of walking away normally has a 50/50 chance that the buyer/seller will come back and accept your offer or at least change their offer.
I experience this every day and have had people get so upset that I didn't change my offer and then hang up only to call me back in 15min to 1day later to accept a 5-9k drop in the price. If you can save an extra 3k on each deal and do 10 a year that equals 30k and if you are doing a 100 that is 300k that you could use to hire more people ;)
You must be firm and confident in you dealings, otherwise you will be tossed with every counter offer and time pressures. Knowing your numbers, market, and walk away point will help to give you that additional confidence and negotiating power.
Always remember, there is always going to be another deal ;)
When it comes to negotiating you must always know your "walk away point" and never get wrapped up in doing the deal (thats where you loose time, money, and sometimes gain unwanted problems that you can't afford or don't want to pay). The power of walking away normally has a 50/50 chance that the buyer/seller will come back and accept your offer or at least change their offer.
I experience this every day and have had people get so upset that I didn't change my offer and then hang up only to call me back in 15min to 1day later to accept a 5-9k drop in the price. If you can save an extra 3k on each deal and do 10 a year that equals 30k and if you are doing a 100 that is 300k that you could use to hire more people ;)
You must be firm and confident in you dealings, otherwise you will be tossed with every counter offer and time pressures. Knowing your numbers, market, and walk away point will help to give you that additional confidence and negotiating power.
Always remember, there is always going to be another deal ;)
Hope this helps on your next deal.
-Steve
Thank you, Steve. This does help, priceless information. I am floored by the overwhelming responses and invaluable guidance I've received here. I can't thank everyone enough for their comments and direction.
Absolutely glad to help out. We all started somewhere and continually seek out guidance to continue to grow in our expertise and niches. Giving back and helping others achieve their dreams and goals is much more fulfilling and rewarding than not sharing :)