Here is what I've learned from the negotiating process:
- Listen a lot, talk very little. Let the developer's agent do all the talking. Remember all relevant information: developer's company, previous developments, intent for the property. The more information I have, the better my negotiating position since I can research the information.
- Share only public info; don't share non-public info. I am happy to discuss property size, zoning, topography, property cost, etc. Remember, the agent represents the developer and will share everything with the developer.
- Know my property potential. With the Internet, I have been able to research nearby properties for sale and nearby developments. With that information, and a previous appraisal, I determined a fuzzy asking price for discussion.
- Be ready for a low ball offer. I have had some very low bona fide offers, which were later increased 33% to 200%, despite the agent implying I was getting a good offer.
- Counter all offers, even if the counter is the asking price. In an article I read, low ball offers sometimes end with up final contracts within 5% of the asking price.
- Specify that all discussions are negotiations and that nothing is binding until written into contract, reviewed by my attorney and signed by both buyer and seller. That way no verbal or email discussions are binding.
- Be ready to walk away from the negotiation. Since I wasn't planning to sell for a couple years anyway, this is easy to do.
Finally, I always remember that I am the only person looking out for my interests, especially when the buyer's agent or buyer offers to provide me "professional perspective" to convince me to sell.
For more on Strategies and Plans, check back Mondays for a new segment.
This is not financial, real estate or legal advice. Please consult a professional advisor.
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