Negotiating in Life, Business Negotiation August 31, 2011

What you can learn from negotiating a property deal

One of the most common negotiations most people will enter into is the property deal. At some point, people buy (or sell) a house, negotiate a commercial lease, or buy (or sell) land.

Any negotiation—including a property negotiation—involves strategy. According to Dr. Chester L. Karrass writing in The Negotiating Game, buyers and sellers have different strategies, some of which are:

Buyers:

• Realize the power you have and maintain it throughout the negotiation
• Know what you are buying
• Work on understanding the seller’s costs

Sellers:

• Invest time in a good cost estimate and accounting system
• Source of power lies in the in-depth knowledge of what you are selling
• Have a back-up proposal at the ready

Inc. Magazine’s article “How to Negotiate a Land Deal” provides five tips that are applicable to any deal:

1. Review the property (or review the product or service)

2. Review any property covenants or restrictions (understand what you can or can’t do with what you are buying)

3. Do a cost analysis (natch)

4. Don’t be adversarial (think win-win)

5. Make a fair offer.

Essentially, coming up with a fair deal in property takes the same type of consideration and strategy that any buy-sell negotiation. Both sides will need to understand what is being bought-sold and where the pricing comes from.

What have you learned from buying a home or selling property?