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Quick story from this week.
Showed a condo already priced 20-30K under the five other identical available units in the same development. Same floor plan, same building, same everything; just a better number already. Yes, it was a little dinged up and had no staging.
Buyer says, ‘let’s do it’.
A lot of agents just write it up. Buyer’s happy, deal’s clean, nobody’s angry. That’s the easy version of this job. On the way to closing.
But, I make a call instead. Novel idea, right? Standard question I ask every listing agent: “what’s important to your seller?”
Ok, it’s not really rocket science. Nine times out of ten, the answer’s price.
But, I get so few calls from agents actually asking me that when I’m on the other side, it’s weird that most people don’t bother.
First, the agent picks up the phone when I call; anomaly one.
And, this time, what was important wasn’t price. Anomaly two. What was important was “clean deal.” Property’s in a trust.
That told me exactly what to do. My buyer didn’t care about the cosmetic deficiencies, the old cabinets and nicks on the counters. Didn’t care about the ‘lived-n-ness”. He knew it was a little dated going in, and he was also savvy enough to know it was already priced well.
So, we wrote an offer giving the seller what he wanted, and actually it was stuff that we didn’t care about anyway. Good down payment, short close, tight dates. It was all stuff that mattered to the seller, so it was easy to offer it. In exchange for a legitimate reduction in price, off an already low base.
We built the offer entirely around what the seller actually wanted instead of shit we as buyers didn’t really need. We put nothing in the offer that was messy for the agent to have to explain to a trust. We were able to hand the agent the easiest yes that he’d get all week. We were able to make it easy for the seller to say yes to us. THAT is what a successful negotiation is. Yea, there was no magic juju in this one. I didn’t split any atoms on the deal. What was magic was that we recognized what the seller needed and gave it to them.
And here’s the beauty of some negotiations – you try to never want the shit you’re giving them anyway. That stuff is, the stuff you want, is over here out of sight, and not mentioned until you need it to be. Negotiating isn’t extracting more. It’s figuring out what the other side actually values, giving them that, and keeping everything you really need quiet until crunch time.
Most people negotiate the number. Almost nobody negotiates the deal.
Because of that, we still walked away with almost 7% in concessions on a place that was already a great deal.
We are currently considering about 90% of that reduction in price to go to a rate buydown. This will save so much more per month in the first couple years than a straight reduction in price will.
A lot of people don’t ask what the seller actually needs. A lot of agents decide what the offer looks like based on just what the buyer needs.
But it helps to be a little more nuanced and recognize your counter party’s needs as well.
This is really what a buyer agreement is supposed to guarantee you.
It’s not just a formality based on a NAR lawsuit of two years ago. It’s actually someone on your side listening for the thing you didn’t know to ask about.
And on the money, usually the first question people ask about with buyer representation? This typically isn’t even costing you anything extra.
In the vast majority of Colorado real estate deals, the seller’s still covering most or all of the buyer agency fee.
You’re not being asked to pay for representation.
You’re just deciding what kind of representation you choose. The kind that looks for second and third level effects, or the kind that opens doors and just writes a contract off a matrix provided by their broker.
If you’re planning to buy in the next 3-6 months, let’s have that conversation now before you’re standing in a place you already love, ready to say “I’ll take it,” with nobody listening to what actually gets you the best deal on it.
Peace
