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California Real Estate March/April 2013 : Page 18

Listen Closely to And more tips on effective negotiating | By Broderick Perkins F Planning to Negotiate or REALTORS ® , negotiating can be a quandary. It’s tough to close the deal and come out on top if you aren’t adept at negotiations, yet learning how to negotiate isn’t a prerequisite to obtaining a real estate license. è As a result, obtaining negotiating skills is a process of on-the-job training—and sometimes it shows. è More than one in four homebuyers surveyed by the CALIFORNIA ASSOCIATION OF REALTORS ® wished their agent had done a better job of negotiating. è “If you don’t have good nego-tiation skills, you develop them. If you don’t develop negotiating skills, you won’t be a good agent,” says Phyllis Harb, a short sale specialist with Prudential California Realty in La Canada, who penned the “Real Estate Game Plan” chapter of Sell Your House Fast for the Right Price (Wyatt-MacKenzie, 2012). è The experts say negotiating is a discussion or series of discussions designed to culminate in an agree-ment among all parties. In successful negotiations, one side or both may or may not get all they desire, but everyone walks away suffi ciently satisfi ed to sign off on the deal. agreeing to disagree, ending negotiations and walking away from the table. The best negotiators plan for this, especially when there are others available to consider the same offer. “If you know you have other choices and some idea of what you are going to do if this doesn’t work out, it prevents you from making a bad deal,” Donaldson explains. Knowing who is on the other side of the table can help you set goals, fi nd your limits and reduce the possibility of having to walk. For example, a seller’s real estate agent facing a buyer’s agent who is a stickler for home inspections, no matter the market con-ditions, knows home inspections is where he or she may have to draw the line—or cross it. Market conditions also play a role. Many of today’s low-inven-tory markets offer little room for negotiations. “Where multiple offers are the norm, it’s mostly a matter of how much capability your client has, funds, how fl exible they can be on closing time and waiving pieces of the inspection process, simply to get the property,” says Barbara Lymberis, 2012 presi-dent of the Santa Clara County Association of REALTORS ® in San Jose, Calif. Illustrated by Jori Bolton Success typically requires detailed planning, top-notch interper-sonal relationship skills, and the ability to juggle lots of balls in the air. C.A.R. talked to a variety of professional negotiators, who explained where negotiations most often break down, and offered suggestions on how to improve your negotiating skills. “Without question, the most important element to negotiations is what happens before you walk into the room. It’s preparations,” says attorney Michael C. Donaldson, who has taught classes and written books on the subject, among them, Negotiating for Dum-mies (For Dummies, 2nd edition, 2007) and Fearless Negotiating (McGraw-Hill, 2007). Donaldson says preparing for a negotiation session can often take longer than the negotiation process itself, and should include articulating your desired goal or goals, learning about who’s ne-gotiating on the other side, and being aware of any market condi-tions that can impact the process. It should also include knowing when to walk away. Negotiations can culminate in disagreement, with both parties 18 CALIFORNIA REAL ESTAT E • M A R CH/APRI L 2013

Listen Closely To Your Opponent

Broderick Perkins

For REALTORS®, negotiating can be a quandary. It’s tough to close the deal and come out on top if you aren’t adept at negotiations, yet learning how to negotiate isn’t a prerequisite to obtaining a real estate license. <br /> <br /> As a result, obtaining negotiating skills is a process of on-the-job training—and sometimes it shows. <br /> <br /> More than one in four homebuyers surveyed by the CALIFORNIA ASSOCIATION OF REALTORS® wished their agent had done a better job of negotiating. <br /> <br /> “If you don’t have good negotiation skills, you develop them. If you don’t develop negotiating skills, you won’t be a good agent,” says Phyllis Harb, a short sale specialist with Prudential California Realty in La Canada, who penned the “Real Estate Game Plan” chapter of Sell Your House Fast for the Right Price (Wyatt-MacKenzie, 2012).<br /> <br /> The experts say negotiating is a discussion or series of discussions designed to culminate in an agreement among all parties. In successful negotiations, one side or both may or may not get all they desire, but everyone walks away sufficiently satisfied to sign off on the deal.<br /> <br /> Success typically requires detailed planning, top-notch interpersonal relationship skills, and the ability to juggle lots of balls in the air. C.A.R. talked to a variety of professional negotiators, who explained where negotiations most often break down, and offered suggestions on how to improve your negotiating skills.<br /> <br /> Planning to Negotiate <br /> <br /> “Without question, the most important element to negotiations is what happens before you walk into the room. It’s preparations,” says attorney Michael C. Donaldson, who has taught classes and written books on the subject, among them, Negotiating for Dummies (For Dummies, 2nd edition, 2007) and Fearless Negotiating (McGraw-Hill, 2007).<br /> <br /> Donaldson says preparing for a negotiation session can often take longer than the negotiation process itself, and should include articulating your desired goal or goals, learning about who’s negotiating on the other side, and being aware of any market conditions that can impact the process. It should also include knowing when to walk away.<br /> <br /> Negotiations can culminate in disagreement, with both parties agreeing to disagree, ending negotiations and walking away from the table. The best negotiators plan for this, especially when there are others available to consider the same offer.<br /> <br /> “If you know you have other choices and some idea of what you are going to do if this doesn’t work out, it prevents you from making a bad deal,” Donaldson explains.<br /> <br /> Knowing who is on the other side of the table can help you set goals, find your limits and reduce the possibility of having to walk.<br /> <br /> For example, a seller’s real estate agent facing a buyer’s agent who is a stickler for home inspections, no matter the market conditions, knows home inspections is where he or she may have to draw the line—or cross it.<br /> <br /> Market conditions also play a role. Many of today’s low-inventory markets offer little room for negotiations.<br /> <br /> “Where multiple offers are the norm, it’s mostly a matter of how much capability your client has, funds, how flexible they can be on closing time and waiving pieces of the inspection process, simply to get the property,” says Barbara Lymberis, 2012 president of the Santa Clara County Association of REALTORS® in San Jose, Calif.<br /> <br /> More Listening Than Talking <br /> <br /> Closing the deal also means not only being aware of the other side’s position, but actually accepting it as a position that may be just as valid as yours.<br /> <br /> “I think people are so focused on what they need, they don’t see the other person’s angle very well,” says Gregory Encina Billikopf, author of the e-book Party Directed Mediation (Agricultural and Natural Resources, University of California; 2nd edition, 2009), which offers research-based ideas to manage and improve interpersonal confl ict. Billikopf works as a labor management farm advisor with the University of California-Modesto and is a visiting professor from the University of Chile’s Agricultural Sciences Department. He uses a workplace supervisor-subordinate issue to illustrate his point.<br /> <br /> The boss is more likely to listen to a reprimanded employee’s reaction if the employee responds without emotional undertone, but in terms of the job at hand, particularly how his or her performance in that job will best serve the company.<br /> <br /> “Typically, you will go talk to the supervisor about how what he said affected you personally. What you should say is, ‘How can I, in my role, do a better job to help your business?’ That’s music to his ears. Your supervisor will be much more willing to listen to your concerns. Just try to think from the other person’s perspective,” says Billikopf.<br /> <br /> Understanding your opponent’s point of view is a skill that requires emphatic listening—really hearing, without waiting your turn to get your point across, Donaldson says.<br /> <br /> Emphatic listening hears what the opponent wants, why he wants it and how badly he wants it. It includes refl ecting back and double-checking to make sure you’ve heard his concerns.<br /> <br /> This advice translates well to real estate transactions. Sometimes it’s a matter of sitting down with the other agent and listening to concerns. Being face to face can help too. In this age of texts and emails, a little in-person, emphatic listening can often go a long way.<br /> <br /> Billikopf adds, “People love to irrigate and fertilize their tree of pride. Everybody has a tree of pride. A little tree or a big tree. But we hate to prune it.”<br /> <br /> “When you listen, you gather information and that puts you on top. All great negotiators are good listeners. You ought to do four times as much listening as talking. Your mouth will get you in trouble,” says Donaldson.<br /> <br /> Constant Juggling <br /> <br /> Today’s real estate arena demands a special kind of negotiator able to juggle a host of negotiations, says Jim Hildreth of Sonora, where he spent two years as mayor and 12 years as a city councilman.<br /> <br /> As a former politician, Hildreth knows negotiations and his Real Estate Mediation Services company is in the thick of it.<br /> <br /> “The banks don’t get back to you for two months at a time, but expect you to jump through hoops in two days. It’s supposed to be a short sale, but at the same time, they are dual tracking it as a modification and a foreclosure. The documents get lost. The consumer doesn’t get educated and isn’t prepared. Lawyers are getting into the negotiations. You are juggling all those balls and it could very quickly collapse,” says Hildreth.<br /> <br /> The key to successful real estate negotiations, Hildreth says, is to adroitly apply all the rules, the planning, the listening, the market knowledge, while tossing in a heaping helping of tenacity and being prepared for a pay check that might not match the work load.<br /> <br /> It’s about orchestration.<br /> <br /> “You are the band leader and you have all these parts. If you expect good music, you have to orchestrate good music. Then you let it roll and you go home, don’t have a drink, take a long walk and say, ‘Man, I’ve had another wild day.’” ® <br /> <br /> Broderick Perkins is a journalist and Executive Editor of DeadlineNews.Com.

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