Is your real estate career and income growing? Is your level of communication skills at a place where you can handle crucial conversations in any situation? Are you getting every possible amount of value from every relationship or deal? Are you on track to beat your goals from last year?
If you answered “no” or “maybe” or “almost” to any of these questions, you may be going backwards.
Like many real estate agents, sharpening your skills and reaching new levels of success is a continuous journey. If you want to be successful, you’ve got to have top notch communication skills. With strong communication skills, your chances of achieving mutually positive outcomes during any negotiation or step of the sales process will absolutely improve.
Considering how serious you are about your real estate business, don’t leave anything to chance.
If you want to be an amazing negotiator, you’ve got to prepare and practice your skills. While every situation is different, there are definitely some common and critical tactics you should practice to guarantee success.
Today, we’ll give you Part 1 of 2, of the most powerful tips to help you become a top real estate sales agent by mastering the art and science of negotiation.
1. POSITIVE STATE OF MIND
Let’s begin with your state of mind first. Every action begins with a mental thought. As human beings that’s how we all operate. Before going into any negotiation, make sure that you’re in a positive state of mind so that you remain open to hearing the side and perspective of who you’re talking to. By keeping an open mind, you’ll be able to pick up on important notes, facts and behaviors that you can leverage during negotiations.
Once your state of mind is in the positive state that it needs to be in, prepare for a couple talking points that are important to the other person on the other side of the conversation, to also help them create a positive state of mind (see tip below). You’ll definitely help yourself, and your client, and improve negotiations at the same time by creating an environment open for communication.
TIP: Be genuine. Savvy buyers can see right through a sales person. The key to being genuine is being yourself, talking by using everyday language and if you’ve done your homework, you’ll know what topics to talk about that are built on personal rapport and areas of common ground that you’ve discussed before.
2. DON’T “SHOW ME THE MONEY”
As a sales oriented person, real estate agents are naturally motivated by money. I get it.
But, by focusing on the money, you’ll kill the deal and perhaps your career before you even get started. Do your best to forget about why you need the money. I don’t care if you owe a lot of money, if you need to pay bills or if you just want to make it to the next level of your income goals. Wipe it out of your mind.
So, what should you focus on?
Focus on your your “Unique Selling Value Proposition” (USVP). You’ve got to know your USVP and why you’re the best person to help your customer.
Let’s face it. There’s thousands of real estate sales agents out there. The prospect can literally go to anyone to get what they want. So, why you?
Here’s an example, let’s say I’m a Business Process Outsourcing (BPO) company and we’re opening a BPO Call Center somewhere in the South for 2,000 employees. My USVP should be, “I’m an expert at helping BPO Call Center’s find housing options in Las Pinas. I’ve spent hundreds and thousands of hours of research to ensure company’s like you, know the best options and what makes them the best to ensure close proximity, easy transportation access and affordability that will ensure a happy and productive workforce.”
By knowing your USVP and ensuring that it aligns to the right prospect and that the prospect knows the value that you bring to the table, you’re in a better position to being trusted advisor that also eliminates their ability to go anywhere else.
3. STARTS IN THE BEGINNING
If you’ve studied the art and science of sales, you’ll know or have already agreed on the conclusion that the key to successful negotiations starts at the very beginning of your relationship with customers.
Because negotiations aren’t just about money or closing the deal. In almost all cases, you’re also negotiating for each step of the sales process, for information or for access to other decision-makers.
TIP: Since you’ll be gathering critical information about your potential client and because time may pass, always document everything you can from the time and place you met, to their purchasing requirements, all the way to comments about their personal life. Even better, if you have an online customer relationship management (CRM) system, input everything in there so that you can have a centralized view of all your interactions about all your prospects and customers in one single place, where ever you go.
Point being, start putting into action all of these negotiation tips from the very beginning of every of every relationship. Not just at the end when you’re trying to close the deal. If you do this, your deals will start to close naturally.
4. RESEARCH, RESEARCH, RESEARCH
Your success and every real estate relationship and deal is gonna depend on information and knowledge you’ve gained from the beginning of the relationship.
Here’s a partial list of different types of key information that you should pay attention to and gather:
– What personality types are you dealing with?
– Who do you think is the decision maker?
– What are the requirements of the type of property they’re trying to buy?
– Why are the buyer’s motivated to buy?
– Why are the seller’s motivated to sell?
– What are the non-negotiable points for both sides?
5. PREPARE YOUR PLAN
In almost every situation, you should try to profile and identify the type of buyer you’re working with. In doing so, you’ll be able to better understand what the typical characteristics are that are involved that could play a role in closing the deal.
For example, if you’re working with a first-time home buyer that’s looking for a condominium for their own personal use, you should consider implementing certain steps, tactics and plans that will help you and your customer based on their specific scenario. In contrast, someone buying their second or third commercial investment property is much much different than a scenario of someone buying a condominium for the first time.
So, in this example of the first-time home buyer, I would consider suggesting (negotiating steps) to help them identify the different financing options first before we even spend any time looking at properties.
By profiling and having a plan for the different types of scenarios, you’ll be able to make better suggestions to prospects which will ultimately improve your perception and leverage as a “trusted advisor”. Other real estate sales agents who don’t do this, will ultimately end up wasting a lot of time and energy of their own and their customers which could be very frustrating.
6. REVISIT MOTIVATION (of the buyer side)
As a real estate sales agent, knowing why someone wants to buy a property is like having pocket aces when playing poker or like having the secret recipe to the world’s best tasting cookies. This type of critical information can be what helps you achieve successful negotiations almost more than anything else.
Unfortunately, the majority of real estate sales agents never ever understand “the why” of what what motivates a specific buyer. Instead, many real estate agents focus on “the what” of what the customer wants to buy and “the how” of the steps the customer has to go through to buy real estate. And, like little robots, sales agents run around, as if they’re basically ignoring the most important point of any negotiation.
For example, for a particular commercial retail rental space that I’m involved with, I was negotiating with a global retail establishment (who will remain nameless) and I asked them, “Out of curiosity, I’ve never seen any of your retail stores outside of malls so I’m surprised, albeit pleasantly surprised, that your company is interested in renting from us since we’re not a mall…what is it about our property that makes it ideal for you”?
Well, it turns out that they have a corporate initiative to “penetrate communities” outside of the malls due to rising rental rates and the increase of traffic on the roads that’s forcing consumers to shop more locally. From there, I was able to empathize with them about how difficult it must be to manage a financial plan around rising rental expenses which enter into a casual conversation on the average price of mall rates. From there, I got critical information on rental rates that they’re used to paying which I used to to justify my rental rates.
As you can see, negotiation for real estate agents is a big topic and I can go on forever about it. That being said these 6 keys to successful negotiations is just the first of a two part blog series. Hopefully this is a good start, to either get you going in the right direction or to help you validate what you already know. Either way, this is just the beginning and it gets even better. Upon release of Part 2, we’ll cover topics like dealing with emotions, objection handling and key closing statements and much much more.
To get notified about the release of Part 2 of Negotiation 101 for Real Estate Agents, sign up here.
Tech Guy & Real Estate Investor super passionate about helping real estate agents, brokers and developers grow their business to reach new levels of success.