The ART of Negotiation Needs to be the New Normal in Real Estate!
The strange thing about the Real Estate game is that you get your certificate or license and you now go around telling people you are a negotiator? Not one deal under your belt and you are now an expert. Really? I think probably not. So how do you become a great negotiator, even if you have not done one deal?
Well, the thing about negotiation is that you do it every single day unconsciously, whether it be negotiating what restaurant you go to for dinner or why you need that new car. It happens regularly but how can you apply it to real estate instantly. Well, one of the most important things is to first understand how people are motivated.
“They move towards pleasure and away from pain”
Once you understand this, it really becomes quite simple to paint someone into the picture of where they want to be. This is very difficult at first, as you need to get hands-on practice. My big first tip is not mine, it was from my first boss, that I have adopted. You must do hours and hours of role play. He simply said I would rather you stuff up in practice than on a $15,000 commission cheque. It made sense to me, so that is what I applied to my sales team.
We took it so far as to film it and review it like you would your golf swing if you were a golfer. This really helped our team pick up mistakes and also present and negotiate under pressure. We took new salespeople to sound like they have been in the industry for 10+ years, in a few short months.
“Put your salespeople under high–pressure negotiation situations so that they are used to pressure”
Now one thing I want to bring up is that in our presentation, we brought up negotiation and made it a very important part. We talked about having the ability to leverage value by applying our negotiation skills. Yes, they received some training, however, I wanted to have a unique point of difference. I looked around and thought to myself, well we are really acting, so maybe an acting school? I found this and thought perfect. Persuasive Negotiation by the national institute of dramatic art NIDA Corporate.
Real Estate Negotiation was getting serious!
It was an intense full day of training which was really incredible. Nothing to do with Real Estate, but the skills we all learnt will never be forgotten.
The really hard part was having to negotiate with an expert, in front of a group. The pressure was fairly intense, and you could not finish until the job was done.
Now having this on our resume, it gave us the right to walk into a listing presentation and say you are a fierce negotiator, and here is why. The vendors really were impressed and then when we demonstrated how we handle a difficult buyer, it was game, set, and match.
These two things were paramount in creating agents that were the best negotiators in the game. I think my proudest moment was when one of my salespeople, Max Yii, who was in the game for only 1 year, brought in a commission cheque close to $100k. This was all due to the training.
Why is negotiation in Real Estate so important right now?
The answer is simple. We, as an industry, are staring down the barrel of the hardest times, we have ever been through, with COVID-19, increasing expenses, downward pressures on fees, and software companies trying to take a large chunk of our pie.
The major part of a Real Estate Agents’ job is to demonstrate value. This is really the only way the industry can protect itself. They must skill up! The better you get, the easier it is protecting your fee. If agents continually go around telling owners a price and then just basically put it on REA, then I do not see the normal agent being around in less than 5 years.
In a nutshell, just to summarise this short article, all agents need to be better at negotiation in these tough times. There are many ways you can get better, be committed to training, and demonstrate value.
Good luck out there and stay safe. If you enjoyed this article or found any points you think are sharable, do not hold back and share.