Seller Negotiation Hacks 2: “The Opener”

In a previous article, The Art vs. Science of Real Estate Investing, I let you guys in on you how important it is to develop the art form of investing (not just the science). Today I am going to start sharing with you some of my own Jedi Mind Tricks that have lead me to perfecting this art form.

My Jedi Mind Trick for Negotiation: Rapport

The methodology of this art form dawned on me one day when I was with a client…

I was with this seller who had a dog (and by the way I love dogs because I grew up with them). I was sitting there and I found myself talking for 15 minutes with her about dogs. Before then, she was very guarded. It was awkward. We didn’t know each other and I was just some investor that showed up because she called me…a stranger.

But by the time we were done talking about dogs (15 minutes later), I realized there was no tension. I ended up getting that deal in record time. We actually became friends within that little time.

At this point I realized if you can connect with the seller on a personal level and build rapport, they let their walls down. This is how I came up with the “The Opener”.

Think about it:

If you go to Best Buy for a new computer, you aren’t going to take very well to the pushy salesman who jumps on you, tells you which computer you want and for what price. You have to make an impression of trust before you start negotiating. When you make a personal connection, it begins to quickly dismantle the pre-existing wall of trust and rapport between you and the seller. If the salesman were to give you a minute to warm-up, take the time to find out what it is that you need and then discuss your options with you, he is more likely to get your business and make you happy.

It dawned on me that building rapport with sellers might be the key to getting the deals and save a lot of time doing it. It is tough to break down seller walls and it takes report to do it.

Negotiating with sellers is like doing a dance and trying to see if you’re compatible dance partners, so you want to make sure you get off on the right foot. You both want to come out on top in a negotiation, but ultimately the highest and best form of negotiating is when you can skillfully craft a deal that’s really and truly good for BOTH of you, which starts at the very beginning with learning how to get the seller to take their walls down.

Once I started focusing on relating with sellers, I realized that 90% of the time it was through talking about cats, dogs, or kids. I further developed this art form by always having pictures handy of my kids and pets on my cell phone. When I walked into their home, if they had a dog I would whip out my picture and tell them how much I loved dogs. We were friends from then on and I always closed the deal.

The art of building rapport should start with that first phone call. The same idea applies here. Build rapport by chit chatting and don’t bring up price too early or make them feel like they are under rapid fire. The point of the initial conversation is to simply get a feel for their motivation and sense of urgency and to set that next appointment. If I feel comfortable I will try to get a preliminary price range.

The better you are at building rapport, the easier it is to negotiate price, period.

So gang, here are a few takeaways I want you to keep in mind…

Takeaways to Talk About

Negotiating with sellers is like doing a dance and trying to see if you’re compatible dance partners. Get off on the right foot.

“Jedi Mind Tricks” that can be used for good or for evil, of course… (but should be done with the intention of building honorable trust).

Skillfully craft a deal that’s really and truly good for BOTH you and the seller, which starts at the very beginning with learning how to get the seller to take their walls down.

It’s all about making an emotional connection with the seller as quickly as possible to build rapport and dismantle the pre-existing wall of trust.

But, if nothing else, remember:

The better you are at building rapport, the easier it is to negotiate price, period.

Hope you guys got some knowledge for your noggin’. Stay tuned for the next lesson in this series, Seller Negotiation Hacks 3: First Contact (and the “Higher Authority” Trick), in which I will reveal the single most important negotiation tactic you can ever learn.

Until then – Keep it classy.

Cody