This blog was originally written in May of 2008 in conjunction
with my ex-business partner Scott Messing while working at ERA West Wind in Boise,
Idaho. I am using it again since the information remains relevant and helpful.
I hope you all enjoy it.
Homeowners and soon to be homeowners need to learn how to dance
with each other.
Whether you are thinking about
buying or selling in this uncertain market please take the time to learn to
dance. A key factor in any successful real estate transaction is the art of
negotiations. It doesn't have to be a difficult process. It's the matter of
taking the time to know when to take a step forward or take a step back and
learning the steps of a graceful dance to bring the real estate transaction to
a beneficial end for all parties involved.
Living in a me-me society as
we've come to be, people forget that their wants are not all that are involved.
But there are needs on the part of buyer and seller alike that must be taken
into account. You can do a 2 step and kill the transaction with ink and pen or
you can do a beautiful waltz that give you a first place trophy on Dancing With
The Stars.
Make sure the agent you select
is the star that will take the lead in guiding you through the difficult phases
of negotiating a contract.
Phase
1: Writing a contract and coming to acceptable terms for both parties
When a contract is written you
have 3 answers that you can receive a yes, a no way or a counter-offer, which
means what dance shall we perform. The 2 step is when you write an offer based
on fair comparables that you're agent has provided you. Despite this fair offer
the seller counters for closer to the asking price expecting you to accept it
without further negotiations. A 2 step will usually kill a contract. Learn to
tango and hope that both agents realize that it may take 3, 4 or 5 steps to
come to a melding of the minds where all parties are dancing together without
stepping on each other's toes.
Phase
2: You've come to an agreement, inspection has been completed and items now need
to be repaired in order to continue
with the dance.
An inspection release has been
written and presented to the seller. At this point either party can do The Bus
Stop and bring the transaction to a halt; or you can do The Electric Slide and
joyfully complete this phase of the purchase.
Listing every single item in
need of repair will usually kill a transaction. Unless you are buying a brand
new home it's not necessary to ask for all the small items in need of repairs
to be completed. For example new outlet covers cost $.50 to $1.00 at your local
hardware store and cracks in the sidewalks can easily be filled after closing.
Major items that will impact your health and/or safety should be addressed. For
example foundation, roofing,
plumbing, electrical and HVAC related repairs should not only be addressed, but
grouped together in non-intimidating ways on the inspection release so that all
parties feel comfortable and informed, helping you slide right pass these
hurdles.
Phase
3: The signing at title
Coordinating all parties and
keeping everyone patient until the documents have been delivered to title,
reviewed and adjusted if needed by the escrow officer and making sure the final
walk through is complete make up this graceful dip of a finale.
Sometimes due to work schedules
there can be some little hitches where the seller or the buyers have to adjust
whom signs first. As long as all parties stay in communication this can work
out smoothly, ending the dance on a wonderful upbeat.
We decided to write on this
topic based on a few recent real life examples. We share these examples and
this blog entry in hopes that it will help people in the future.
Case 1: Recently on behalf of our client we made an
offer and unfortunately it was killed based on the 2 step dance example. The
listing agent encouraged a dance but abruptly halted it despite having actual
comparables indicating a lower price that we believe the listing agent chose to
psychologically dismiss. Comparables showed the home to be worth 15,000 less
than the asking price. The appraisal would not have come in at the asking price
and we must wonder if the agent even told her sellers this information.
Case 2: One buyer's agent we worked with nearly
killed a transaction by insisting on several small items being repaired in
order to make her appear as a superstar, despite the items requiring little
money or time. In this case the agent's ego was on the line instead of any of
the client's best interests. Luckily our ability to find excellent and
affordable vendors willing to step up and help the seller's family get through
this process with little financial burden saved this transaction. We were able
to smoothly complete what appeared to be a nightmare for the sellers. In the
end it turned out to be a blessing.
Case 3: As the dance was nearing end the title
company found a hidden Liz Pendens (legal action pending against a property).
Our clients and the listing agent started to freak out. Tami's negotiation
ability kept our clients and the other agent calm. Thankfully having a great
escrow officer and negotiator at the title company also contributed to the
success.
Thank You For Reading;
Tami Lee Merriam
BRE# 01936304
RE/MAX Gold
Tami.Merriam@gmail.com
http://www.linkedin.com/profile/view?id=31668742&trk=nav_responsive_tab_profile
https://www.facebook.com/WineCountryPropertyInfo
Thank You For Reading;
Tami Lee Merriam
BRE# 01936304
RE/MAX Gold
Tami.Merriam@gmail.com
http://www.linkedin.com/profile/view?id=31668742&trk=nav_responsive_tab_profile
https://www.facebook.com/WineCountryPropertyInfo
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