We Are Selling with Lee Woodward
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We Are Selling with Lee Woodward
170 - Information Controls the Process: Mastering Real Estate Negotiations
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Mat Steinwede returns to share his expertise on negotiation, highlighting how information gathered early in buyer relationships creates powerful leverage for achieving premium prices.
• Information controls the process – use what buyers tell you early to guide later negotiations
• Great negotiation starts at the first meeting by truly listening to what matters to buyers
• Focus on building quality relationships with fewer buyers rather than quantity
• Common mistakes include quoting discount prices when asked "what will I get it for?"
• Accepting low offers without qualification costs vendors thousands
• Reference points and framing help move buyers through psychological "platforms"
• For stuck negotiations, sometimes bringing parties together face-to-face breaks deadlocks
• Written offers in formal marketplace reports can convince reluctant vendors
• Practice negotiation scenarios regularly through role play and mental rehearsal
• The best negotiators connect buyers to their property goals rather than fighting over price
If you want to become a premium negotiator, Mat recommends dedicated practice: "I've been role-playing with myself for 10-12 years. I don't want to play on people's real homes. I want to be well-versed in handling their homes best."
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Hello and welcome back to the podcast we Are Selling. My name's Lee Woodward, the author of the Complete Salesperson Course. Today's podcast is brought to you by our sponsor, nexar. Nexar is a dedicated real estate platform specializing in lead generation and database management of the entire real estate company For BDMs and agents. Working as one platform to generate opportunity. Nexar seamlessly integrates into your business systems, allowing you to have an extended solution. Let's get started with this week's episode. Hello and welcome back to this week's episode. Hello and welcome back to this week's podcast.
Speaker 1:As mentioned on social media, matt Steinway and myself are returning into the studio to record the Ultimate Real Estate Agent Sales Program, and a big part of that program is the revisit of the Matt Steinway real estate system that was recorded 22 years ago. It was then updated in 2011, where we went back into those recordings, as we're about to do now, and over the last three days I brought those updated tracks back into edit so that we can do some masterclass work, and today we're going to do the negotiation masterclass. Let's get started. When we talk about the art of negotiation, it's often misunderstood of what you need to do, what you need to say and how we make people feel If you're driving along right now and you tell people I'm a skilled negotiator, I want to ask you the question what study have you done on this topic? Matt Steinway completed the Matt Steinway system on his selling process, but this topic is a very special understanding of how to do it. He joins us again. Please welcome to the studio, mr Matt Steinway. Matt, welcome aboard. Hi, lee.
Speaker 2:Thanks very much.
Speaker 1:Matt, this topic? No one seems to know this and I know from you coaching others, especially the younger people coming through. Everyone says they're a great negotiator, but how do we know? Our topic outline today is very direct. We're going to get right into the content of the topic, but just give me your view on negotiation, and where does it start?
Speaker 2:Over the last 15 years in real estate, I haven't been able to find anywhere that you can actually study negotiation or learn about it. I've bought a few CDs from America. There's only a couple of sets out there, but they're all very techniquey and a bit illusionary, just in my opinion.
Speaker 1:Well, very old-fashioned and trickster Like, if you can trick a client to think this, you'll close the sale In real estate. It's not about closing the sale. It's about confirming the whole information and situation so everyone is comfortable with their purchase.
Speaker 2:Wipe away the mist and get to the bottom of you. Know how do we handle an effective negotiation? So where does it start? Was the question you asked just then. It starts when you meet the people. It starts by listening listening to what they're saying, understanding the message that they're getting across to you, not so much the words that they're saying, but the feelings that they have around, what they've experienced before, what they want, where they're going, really listening and grabbing onto that information.
Speaker 1:Let's have a look at our top 10 things. We forever negotiate. We've got to negotiate our fee, price terms, concessions, the marketing, what some people refer to as a non-negotiable the expiry of the listing, the final fee, meaning you've got all the deal together and they say, well, just before we end up here, let's re-look at your fee. So I'm going to use these as our framework, but I'd like you to share your technique, because technique goes across all 10. There's not 10 different ways to do it. Negotiations are psychology and I think if we can learn that in this program, our outcome will be outstanding. Matt, I'm going to give you some key words to lead you into the preparation that you and I have done prior to this recording, and I loved it when you said to me information controls the process.
Speaker 2:The key to an effective negotiation is feeding information back to people that they've given you already, and this is what I mean about understanding what's important to people. When you first meet them, like when I meet a buyer I think to myself this is where I start negotiating, this is where I start gathering all my information about how much they've got to spend what they really like where they live. Now. What are they looking for to spend what they?
Speaker 1:really like where they live now. What are they looking for? It'd be fair to say it's better to gather the information early on a property they don't want to buy versus when the game is on on a property they do want to buy.
Speaker 2:The number one thing that I do when I meet somebody and they say, look, I've got $5 to $5.50 to spend on a house, and I'll say to them, look, if I found the perfect house and it was $620,000, would you like me to show it to you? Oh, definitely, 100% Right there, I know. If I find them a house for $580,000, they can pay $580,000. It's just how I help them get there.
Speaker 1:And, I think, another great question while we're in this let's call it preparation stage of negotiation what's the best home you've seen so far and why didn't you buy it?
Speaker 2:It's reference points, reference points and framing. This is what negotiation is about. You know, when you take a buyer to a house and they say, oh, you know, I think mine's better than these ones, or you know, I like my house much better than this, and you can get frustrated with that because you think to yourself, why don't you just stay in your house? But what they're saying to you is there's important characteristics about the home that they live in now which they'd like to transfer to this area that they want to move to. I always ask people tell me about the home you live in at the moment. This is before I even take them to show them a house. Tell me about the home you're living in now. What do you like about the particular house you live in? Because this is a reference point for them. It's very real, it's very true for them, and they want to connect with another property over here on the central coast.
Speaker 1:If they're from Sydney that has some of these key elements, Great key question here is what is it you don't have in the property you have now that you'd like to achieve in your next move and I love the word property goals? What are we trying to achieve? What are your property goals?
Speaker 2:Spend a bit of time with people, create a question list. That's not intrusive, but just so you can start, and you can start formulating what's this?
Speaker 1:person's life about and when it comes time for the real negotiation. I love movies about legal battles and the great trial lawyers, but when they say but you said on the 12th of September you left the building at 105. How could you be there at 145 when it's a two-hour drive? And suddenly that fact now has been overridden. You mentioned you're going to buy the other home down the road, but it doesn't have a dog-friendly beach, and I've got that as something really important to you. Well, suddenly the next 20 grand comes up, because that is now null and void.
Speaker 2:The questions that you're asking these people spend a little bit more time with people. It's not about working with as many buyers as you can work with. It's about working with quality buyers over a period of time. But the questions that you're asking people up front, early on are creating the agenda to your negotiation down the track.
Speaker 1:And what we call purchaser logic. A great thing to say to a buyer is let me just make sure I've got this right. We need a home that the kids can ride to and from school. That's very important to you, matt, isn't it? The only thing stopping you from reaching your property goals right now is your perception on price. Can I ask you, if this was sold tomorrow, what would you do?
Speaker 2:I'd be a bit annoyed.
Speaker 1:So is this really about price or is it about the feeling of winning on price? Matt, it's up to you what you do. Every day, in every way, we see someone miss out on the home they should have bought for a perception that they were paying a figure higher than they thought. What if the figure you thought was wrong? Because it's going to be wrong immediately that somebody else pays a higher price and everyone goes. You should have just paid it. We can't, should have done anything if you don't step forward now.
Speaker 2:True, and I would say there as well what sort of value do you put on watching your kids ride to and from school?
Speaker 1:Matt's still on this topic of information controls the process. The more information we have about the reason for someone purchasing or selling or negotiating gives us that positioning as a professional negotiator to win through. I'll give you an example. I had a crappy house with a massive block of land next to a nature strip like a reserve area, and everybody else said, oh, that's an okay house. But to the guy with the bobcat business who could park his truck and no one on the right-hand side to complain, it's like buying a business in a house, so to him it's worth $100,000 more than the general market. But if I don't ring the Bobcat company and say, hey, I've got one. Now he comes in and says I'm not paying, that it's more than the one down the road. It's impossible.
Speaker 2:You know I see every time I show a house to a person, I only work with about 20 hot buyers the most 20 hot buyers probably 15 most of the time, and they're the ones I focus on mostly. I give all the other buyers just about to people in my office because I spend a long time looking for properties for these people. If I'm going to work with them, I want to work with them and find them a house. But I see every time I take them out to show a house, it's like I'm gathering a bit more info, a bit more info, a bit more info. I probably have a position in the marketplace that I achieve fairly strong prices for owners.
Speaker 2:There was a lady that I sold a house to in Avoca. I worked with her for about two years to find a house. I got so much information from this lady. I heard this guy was going to sell his property and I saw it and it was like bang, the right house. I rang her. She came straight up. She finding that fit. And this is what I mean about the power of the information when it comes to sell. She knew it was more than what probably it was worth, but how much do you pay for her kids just to walk across the road to the beach. That's one of her number one criteria and it was like 20 steps to the beach. But I think over a long period of time I almost earned the right to guide her through this negotiation, even though it was more than what the rest of the marketplace would probably think it was worth.
Speaker 1:So your collective intelligence of all the information you can pretty much target, sell something because you'll hear the words all the time. I've got the buy for this.
Speaker 2:If you look at how sales are made. A lot of the sales. There's quick sales and there's longer sales. A lot of my sales. I've been working with the people for a long time and the quick ones are just like a bonus. So I think it's about it's a little bit like buyer prospecting, I suppose. But the negotiation is so much stronger when the relationship is stronger, a good relationship with a buyer. It's worth a premium to an owner because people will listen to you. You've earned the right to guide them.
Speaker 1:Matt, I've been driving along in a car with a purchaser and a lady's pointed out a sign to me and said see that company, I don't care what house they've ever got, I would never, ever buy through them. Now this is the reverse of what we're talking about. Someone's upset a relationship, said a sharp bit of dialogue and women, they're funny blokes. She will not buy this home now because of the attached agent, male or female, in their dialogue. And now we're talking about negotiating feelings. The way you said that to me was disgraceful. Now she may not repeat that back to the agent, but the agent's lost the best purchaser for their vendor.
Speaker 2:You'll notice there's very few scripts and dialogues on here. It's more about the functionality of negotiation and what I mean by functionality. There's a lot more to it. You look at a lot of the high performers or people that are doing really well. They spend a lot of time with buyers. They spend a lot of time with sellers. They spend a lot of time building these relationships.
Speaker 1:That's why they do well, and let me just add to something which is a bit that some people will find as a schizophrenic comment from myself If your dialogue's too good, they don't believe you Roughed up dialogue versus I know what I'm saying, I'm right, you're wrong and this is what should be done. You can be right and not have anything, sometimes slowing up the negotiation and saying, matt, could you just run this all past me again? I want to make sure I've got it crystal clear so when I communicate with the owners, I don't let you down and people like that. You want to learn what they want.
Speaker 2:Now I've always wondered, when you deal with a barrister or a solicitor, as frustrating as they are sometimes they're not dealmakers necessarily, but they confirm everything in writing, everything. You know why? Because they're playing a really strong position of if there is a negotiation, I have everything in front of me.
Speaker 1:There's a lot of power in that, you know, when we look at relationship levels, influence and negotiation, completeness and accuracy meaning I want to copy the sewer diagram. It's emailed that day. I want to know is there a survey? There wasn't one. I've tracked one down from an original sale.
Speaker 2:There it is, and they think you're really good at what you do. There's another 20 grand. How often do we and I don't know if people do or not, but we show people houses, three or four houses spend a couple of hours with them? How nice would it be getting home as a buyer and say, great, to see you today, Showed you 18 Hilltop, dah, dah, dah, dah dah. Whatever it may be this house, I know this part suited you. Just summarize the day nicely. I know what I'm looking for. I will find it for you and I'll let you know as soon as I do. But just summarize what they've seen today the good points, not so good points. What would those buyers think of you as an agent? That you are absolute, professional, 100% on their journey with them. So, come the time of they need to listen to you. What do you think they'll do? Follow your lead, Follow your lead, and that's what it's all about.
Speaker 1:The error made is that the agent's going to rip me off and I've got to pay too much of this house, so we've got to battle the whole way through. The first thing you got to do is remove that situation, like some people used to come really aggressive head on negotiating with me and I'd say Matt, I appreciate what you wish to do here, but based on these terms, I don't think you're going to succeed in living in this home and maybe you should walk away now and let us sell it to somebody else on terms that the owner's more looking for than be frustrated with me as you are at the moment. Or suddenly they're saying don't you want to sell me the house? I'd love to sell you the house, but the way you want to do it, you and I don't own this home. They do, and I'm engaged to make sure it's sold a certain way, and that doesn't just include price.
Speaker 1:Now you're asking for terms and conditions on a home you don't own yet, so I can't meet your demands. When you and I are, we're not on title. The title is to Mr and Mrs Edie, and Mr and Mrs Edie have their feelings and negotiations and they actually have the right to sell it to whoever they like. So unless we can calm this down a little bit and be civil in what we're trying to put forward as a good option, I think we could lose the home just on what we're trying to do you know being a great negotiator.
Speaker 2:It's all about really street smart. It's about being street smart and reading a scenario. You know how there's been quite a few times when the negotiation has just been that difficult. When it has been like that. Sometimes I've gone, mr So-and-so, come with me. I want to sit down with Fred. We're going to have a chat, a cuppa. We're going to have a chat, a cuppa. We're going to talk about where you're at, where he's at. Let's have a chat about it. Hopefully we can shake hands at the end of it and you'll own the house. Bring all parties together, comes together every time because you take away the aggression, yeah, yeah, the stance, the blue and red corner. I'm not afraid to do that. I'm really not. As long as I framed it right with both people, it will come together, and that's what I mean. It wouldn't be great if every negotiation was not sitting in a room with people but had that element of transparency about it.
Speaker 1:This is such an important point. I get two or three phone calls a week with this same question from all different people over Australia Leave the vendors here, the buyers there. They won't drop, they won't come up. How do I get it together? That's the question. It's like an identical question and I always say to the agent firstly, what's the owner's name? Oh, Steve, Is it Stephen or Steve? It's Steve. Now, Stephen's very different to Steve. What's the purchaser's name? Michael, Is it Mick or Michael Mick? Well, you said it was Michael. They go, what does this matter? Just give me the quick script to get the money out. I I need to know the real names because I need to know what to say back.
Speaker 2:You know what I do most of the time when people are inspecting houses, I always tell the owner their full names. I always tell them what they've seen, what they're hoping to achieve in their move, any sort of feedback, obviously, and as much information about them personally as I physically can. This is on the first inspection, you know, and I email them their names and everything, all the information I can. Then, on the second inspection, if they're getting really interested, I like the owner to be there somewhere so they can meet each other. I love that. And I say to them Break down the barriers. Yeah, first inspection. I say to the owner look, you just go down the shops, I'll be right, you know, we'll just go through. It's all about. On second inspection. If it's a second inspection, they're interested. I say, look, would you mind just being out the backyard just gardening? I'd like you to meet the buyers for one, the potential buyers, but also there might be some other things they want to ask you, bam. Once that happens, it's usually a much smoother negotiation.
Speaker 1:I can guarantee you I could go in and represent the offer with delivery and the owner will be completely different. I'll give you two outcomes. That first one we chatted about they're getting it all their own way. How that was delivered was shocking Example. The agent will say they're only offering you 800 because the gutters are knackered, the fences are falling over and the pool needs fixing in the crack. The owner knows those points. That's why they're moving. But when you say it you've changed sides, yet you say it you've changed sides.
Speaker 1:Yet I'd go into the area and say Mr Williams, we have some interest on your home and this is exciting because I didn't have anyone yesterday, but today I do. Well, what are they going to pay? I've started negotiations but I want to make sure everything's in line with what you're thinking. First of all, let me tell you about the people. They're actually going to live in here. It's not an investment. They have 2.5 children. I think they love the way the deck goes to the yard. They think the home's got a beautiful linkage. They can see themselves living here and the owner would pipe up and go oh, I want it to go to someone nice and I go bingo. Now what are they going to pay? They came in at $710. I said no, it came to $738. I'm still working on it and I need to go back. I'm just keeping them in the loop at the moment. Lee, do you think they're going to go to the 800? I think they love your home. I don't know if they're approved to 800. That's what I'm trying to find out.
Speaker 2:Another great thing to say right there, which is I love. What you said then is would you mind if I just handled it for you for a little bit and I'll keep you posted Beautiful.
Speaker 1:But what we both did is not go. Got an offer of 750,. Do you want to take it? You never, ever say to the owner do you want to take it? Because they thought they were engaging superstar negotiator and you're a panicker. My next question for you is this what are the three common mistakes that are made? Something?
Speaker 2:that I demonstrate to owners when I'm listing their property, but also it's the framework that I have. There are three things you need to be very careful of, and I see agents cost owners lots of money by just answering them not exactly wrong, but by answering them not completely. And I guess what I mean by this is. Let's talk about the first one. What's the first question? Buyers ask you what am I going to get it for? Or and there's another one as well is it negotiable? Are the owners negotiable? What will I get it for? Do you know how many agents actually say a figure? Well, that's called embezzlement. My goodness, it is amazing that agents actually say a figure. The reason that they usually say a figure is because you say to an owner look, it's probably worth $550, but let's put it on for $589 and we'll see how we go. Second, a buyer asks that question. It disarms the agent completely. When I say that to owners, owners always say that happened to me.
Speaker 1:And you're also discounting the quality of the home. If people think they can get something cheap, they're excited for a millisecond and then they think why is it so?
Speaker 2:cheap, that's right. What I would say is look, I think the home represents reasonable value. What do you think? Now I listen very carefully yes or no. They say you know it's all right, it's okay. You know we really like it. Where are you going to go with this negotiation? You're going to head to list price or a great price or whatever it's going to be?
Speaker 2:They say no, I need to find the next platform. Which the platform is? Where are they coming from here? So I'll say look, as far as I can see, I think the home's priced relatively well, it's priced comparatively. So we priced it based on firm comparables. Can you give me any reasons why you're thinking it's too dear? And I'm happy to let the owners know, because if you're interested in buying the property, it's really important. We're all on the same page at this point. Any reasons you're thinking it's too dear? Now, if I've got some firm comparables, I'll use them and nine times out of 10, I can overcome their concern. It's all about finding these little agreements on the way, but sometimes I use a property down the road. Mate the property's on for 5.30 down the road, I'll say have you been through that house? Yeah, we took a look at it. How come you didn't buy it?
Speaker 1:Great question Is there any reason why you didn't proceed with that one?
Speaker 2:Yeah, why is that? Oh, you know, the rooms are a little bit small and the backyard wasn't sunny enough. This is a north-facing backyard and I'll say, okay, let's use that home, because they're using that as a reference point. Right, this is like where they live. Almost it's a reference point. Let's use that home. We've got to agree that this home offers more than that home doesn't. It has to Correct Okay, so it's got to be worth more. What would you pay for the?
Speaker 1:house and don't use the whole amount. How much more than that one is this one? Is it $100, $120? Because then you're adding it on to what you've got.
Speaker 2:Sorry and what I usually say just after that is before I say how much would you pay? It's got to be worth somewhere towards there, wouldn't you think? And they'll say, yeah, I guess. So Well, what would you pay for the house?
Speaker 1:That's what I would say to them and I love leading dialogue such as Matt, if we can agree on a higher price, what terms do you need Now?
Speaker 1:I've moved off price to a higher platform, meaning we've got consent on a higher price and they're like I didn't say I'd pay a higher price, I just consented myself. So if we can achieve agreement on a higher price, what terms do you need? What do you mean? Well, do you need a six-week settlement? A 10? I definitely need a six. I've got to be out of my place. I think this one's on a 10 week. I'll need to confirm that. If it has to be 10, can you make arrangements? I suppose we could. You go into the owner. Do you want a six or a 10? I need six. Come back to the purchaser. I've got you your six week settlement, but suddenly platforms are connected to concessions.
Speaker 2:The reason I talk about platforms and you're talking about them as well is the platform is the next logical place to spring from. You don't have that platform. You'll create a massive cavern. You won't get a lawsuit. It'll stall the negotiation. We'll go to the next common mistake, which is an offer. Agents accept an offer on an owner's behalf. That's miles away from where you need to be. It's just a low offer.
Speaker 1:So you're meaning property's on the market for $800. Yeah, and they've come in and said well, offer you $710. And the agent doesn't negotiate and goes to the owner.
Speaker 2:Yeah, well let's say they say what will I get it for? So they all sort of link together what will I get it for if it's on at $800? Oh look, I think the owners will probably take $775, something like that, if you can move quickly.
Speaker 1:And just for the reference of this record that should never be done, never. It's a non. You should never use that dialogue it's not right, never.
Speaker 2:It just costs owners lots of money. Well, it's not your house. You can't consent to anything. Exactly right If you? If let's say that that happens, a buyer responds by well, the agents basically told me how much the owner will probably accept. Let's see how low we can actually go here. Exactly, you've created a new problem. Yeah, offer them $690,000. This is mistake number two Getting a low offer that way or just getting a low offer in general, without actually taking care of it first and diluting it. You go to an owner. Look, the buyers have offered $690,000. What would you like me to do? You're going to go as the owner not interested, but the negotiation has actually started.
Speaker 1:I agree with what you're saying. There's a vision to price.
Speaker 2:You need to find the next platform here. Is this buyer for real? Are they just trying to steal this property? They're just trying to buy it at a price that they consider a bargain, or are they really a buyer for this? I'll say to people look, we've had let's say it's been on the market two weeks. We've had 10 people through the home. The feedback so far has been sort of that upper mid seven range. Is that still within your spending capacity? You're not saying you've got offers or anything like that. The feedback has been and you want to see what they say. I want to see the emotion attached to this.
Speaker 1:Nah, mate, wouldn't pay that. Well, they're not the right buyer, so you've got to have the right buyer for the property most of the time. How interesting. On the Real Estate Hot Topics program once separate to this you mentioned, I don't think I can get a value till I get someone who likes it, Someone who likes it. Now we can start exploring and be careful of the leading question from them, had any offers, yet no.
Speaker 2:And I would say, like I said, we've had feedback through. We've had 10 people through. That's just the feedback that we've had. I've fed that back to the owners. They're educated buyers that have been looking in the marketplace, but we've had no firm offers, just market feedback.
Speaker 1:When anyone says to me have you had any offers yet? I'd say, well, it depends what you call an offer. Many people choose to wait till it's too late and it's sold. Then they always say I would have paid that Now. The interest has been excellent. Are you interested in making an offer? If you can reverse it around in a question, the negotiation can start Whenever they throw that first figure at you how did you arrive at that figure? And then they'll come at you again, so appreciate that. So if the owner said no, what would be the next price you would offer? But it's all platform questions versus arguing with them over their perceived value.
Speaker 2:Look, some buyers are great negotiators without even knowing about it. They're like kids. You know, kids are great negotiators. Oh, can I have an ice cream? Yeah, I can. Well, can I have two Like they?
Speaker 1:just ask.
Speaker 2:You know it's like people like credible evidence. That's why they ask these questions have you had any offers or anyone else interested in it? They like to feel that there's credible evidence around this product, because price is subjective. Is there more money there, you know? Is there $1,000, $2,000, $10,000, whatever it's going to be? I say to a buyer no, they say there's $680. I'll walk away, forget it. Okay, that, okay, that's it. The owners can go jump.
Speaker 2:If they don't take that offer, we'll keep looking. I'll say, theo, you've been looking for what? Three months for the right home and I've helped you right the way through. That's completely fine. If you want to walk away, I'm happy with that. But I just want you to know that I'm happy to help you look for another three, six, twelve months for a home exactly like this. Okay, so as long as, as long as you want to keep looking for, I'm happy to help you. I just want you to know that. But if I can find another home I don't even know if I will I haven't seen one in the past six months like this home that suits you this well in this position. If it does pop on the market, I'd say to be dearer than this, because not only is this home priced fairly well because these owners have priced it to sell within the next 30 days, which it looks like it's going to, but also that's how the marketplace moves. Okay, so this will create the next sale price and the next one will come on, but that's okay. If you want to pay more, I'm happy with that too.
Speaker 2:Just before you walk away, can I ask you a question? If someone was to come into the office tomorrow and pay $690 for it, would you be disappointed? If I can help you secure the home, take it off the market for five days, show you how to do that. Do you just want to move ahead at that and secure the home you actually want? Some people say yes. Some people say, man, I just don't have it. I just don't have it. Look, $685, that's as much as I can go. Credit cards are full, everything's done. I've taken all the change out of the coin holder in the cart. That's it. I can't pay any more. $685, then that's my best shot.
Speaker 1:And that's where you can throw in a dialogue, matt. That's exactly why you should buy it. It will never be at this price, ever again. But I say to an owner.
Speaker 2:can you see right there? I've helped you understand how much is in the marketplace, and that's what selling a home is about.
Speaker 1:Do you agree? In being a negotiator, there's a time to spike the conversation, not to get them upset, but to make them think. So, for example, I remember this one Italian guy was negotiating with me for about two years no, I'm not paying this, not paying this, not paying that, I said one day. I said, mario, every house I've showed you that you didn't buy is now sold. If you're so right, why don't you own a house?
Speaker 2:100%. Sometimes, if people are painful, I say look, the only thing stopping you buying the house that you want is you, but I think you're right there. Stopping you buying the house that you want is you, but I think you're right. There is a time and a place, and this is where street smarts, I guess, comes into play. But there's a time to be a little bit more assertive and not how do you?
Speaker 2:stay neutral, yet lead With the information that I've gathered. It gives you a level of confidence. It gives you a level of connectivity with the people and I just say to them it's more about what they want. It's not about me saying you need to be here, otherwise you can't have it. It's more about understanding what they want and staying neutral. To lead. And lead to me is I'm there with them, side by side. Come on, let's go on, let's secure the home you actually want. Tapping into the thing. It's not even really about price. I mean, as long as they've got the money, it's not even really about price. It's really understanding how their level of comfort and lifestyle around this property.
Speaker 1:When we had Amber Worshen on air doing Breaking Through, she mentioned the word. It's not about price, it's the justification of the price. So how can I help you justify that? This is the price? That's a gem in the way of if somebody else bought it above you, it's been justified that it was worth it. You just don't own it. So what do we need to do for you to feel comfortable that this is the home for you?
Speaker 2:That's the question that you need to be subliminally asking without saying it On a deep level. That's the whole feeling that the negotiation needs to have right the way through.
Speaker 1:You know, I think a powerful thing in influence is to give a weakness. Look, I appreciate you're going to buy this other one down the road. I'm going to lose you on our property and that's not a good thing for me. You have the right to do that and I know you can, and they're thinking yeah right, you understand it, I'm in control because I can do this. Yes, you can, but are you doing that to prove a point that?
Speaker 2:you can do that. You connect them back to their reference point. This is the whole basis of this. It's their reference points, are their reality. So you need to connect them to that and then lead them.
Speaker 2:This reminds me a little story when we've got a new salesperson in our office. He's been in real estate a few years but he's come from sydney and then worked at another agency and come to us and he's got no listings in the area that he's working and the agent down there has got a really big market share and uh, he's in a place. He got invited and was like let's go, let's go all excited down there. Two and a half hours he was there with the bloke having a beer and all that sort of stuff. Not that I condone having a beer at work, but that's what he had to do at that point in time, because after that's right. After two hours the guy said mate having a beer, you're going to have one with me? He said I can't, I'm at work. He said, mate, you're having one and he said okay. He said I'm considering going with Ray White.
Speaker 2:He's got most of the signs and he's got most of the properties for sale here and Martin said yeah, yeah, I get that. I totally understand that. But do you know? He's got 37 listings right now in your area. I have none. You will be my only one. I can give you 100% of my time, energy, effort, dedication to getting you the best price. You can only get one 38th of his and I thought that's just fantastic. And the weakness instead of you know? Oh well, mcgrath's this and McGrath's that. He used the weakness to his advantage.
Speaker 1:Toby Parker from Hocking Stewart when we did the listing DVD in-house for them. It was never launched, it was an internal product. Our actors weakness to his advantage. Toby parker from hocking stewart when we did the listing dvd in house for them. It was never launched, it was an internal product. Our actors were asked to throw an objection at him, which was you don't sell the most homes around here, why would we go with you? And toby sharply said we don't sell the most homes and we've got to work harder than anybody else because we can't afford to absorb a bad result. There you go, crack and come back, love it Because the underdog. You're right, we don't sell the most and we can't afford to absorb a bad result.
Speaker 1:Same technique, but we've negotiated a justification because the other agent will come back and say what did you go with them for? They don't do hardly anything. That's why we went with them. They're available, but the truth sets the negotiation free. It does, because everyone's still flexing muscles at the beginning and I can't stand all that. I'll tell you what makes a great negotiator they're approachable.
Speaker 1:I can actually chat with you. You're not throwing slick dialogue and Benjamin Franklin closes at me. We're chatting here, but you actually have a clear vision about the outcome. Sometimes you've got to stop a negotiation and say, matt, we've been going for days on this, what's going to be the outcome? My final part of this information on conversation about negotiation, because I think everyone's understanding, we have a concept to it. There's one technique you have and I really like this one and I want to bring it to the surface of this audio. Let's say you have done the negotiation and the purchaser's right. They're paying above market, but the vendor's hell-bent on their figure and you've done all the conversations and writing Matt, another technique that you use, or concept, is you put it all in writing in a very detailed document to them for them to ponder over. Explain this.
Speaker 2:I've got a letter that I use and it's a couple of letters, but it's personalized, it's to them. I change a lot of it every time and I deliver it over to the people and I just say, look, I just wanted to put the offer in writing, just to leave it with you, have a read of it and just see what you want to do. Just let me know, after you read a bit more of the background of these people and where they're at and what they're thinking. I'll leave it with them.
Speaker 1:I love that. And what we can add to that now is, mr. And what we can add to that now is, mr and Mrs Williams, due to the law and legislation, I have to put these offers in writing to you. I've done that and sometimes you'll say why do you have to put it in writing? Let's say you don't accept this and then the property sold for $50,000 less. The government's going to want to know did you submit the offer in writing because there is a loss now of $50,000? Is the agent liable? Now, this is a fair market price. We've been on the market for six weeks. You'll see in the detail of my letter I've professionally done my job, but I need to put that in writing to you, otherwise it looks like I've been unprofessional and not done my job or incompetent, and this is a very good price. It's your choice what you do. I understand that, but I can't be seen to be incompetent if it goes for a figure 50,000 less and that would play on their mind of oh my God, the legislation's involved.
Speaker 2:And it sort of links back to that last chance thing. You only get one chance at it and this is where you do need to be sure, but you still want to cover your base in case they just don't want to. You don't want to be the person saying you must take it. That's why the letter in writing is a bit more than we have an offer on your property and blah, blah, blah. When it's in writing, it has a lot more energy about it, a lot more finality about it as well. It's a lot more real for people. It's not just an offer floating in the air somewhere, it's a very real step for them.
Speaker 1:Matt, I'm going to read this letter because I think it's a great executive summary of what we've discussed Now. The front page says Formal offer a marketplace report prepared for for property with a photo. Why so formal?
Speaker 2:Well, I think it breeds credibility.
Speaker 1:I agree with you, and this letter that I've shared with people seems quite stern, and I think it's a time to be stern. Dear John and Lisa re. Mr Simpson, potential purchaser of your property, as you know, we've been conducting negotiations on your property as required by legislation. I'm enclosing a written summary of negotiations so far. On Saturday, the potential purchaser submitted to our office an initial offer of $850,000 on your property. For the past six months, the purchaser has looked extensively throughout the area, so he has an in-depth understanding of the current property market here.
Speaker 1:During the initial stage of negotiations, the purchaser is aware of the sales in the area that compare with your property, thus providing a factual basis for his offer. The purchaser was familiar with the property adjoining yours, which sold for $865,000, and with 28 Gunning Street, which sold for $845,000, with 28 Gunning Street, which sold for $8.45. Both properties were sold in June. Based on these sales, he feels that your property sits in the market between $8.50 and $8.60. After further negotiations, he made another offer of $8.55 on Saturday afternoon. Please be aware that at all times we've been diligent in protecting your value and have been trying to extract the greatest price from both the market and, particular, from this purchaser. With this approach, we obtained a further offer of $860,000 from him on Sunday.
Speaker 1:Mr Simpson has made it very clear to us that this is his final offer. He is prepared to move forward at this price, but feels that the offer is above true market value for your property. Based on the feedback that we've been receiving from other prospective buyers, we strongly believe that 860 represents a very good offer in today's market. Rest assured that we will act on whatever instructions that you provide in this matter, and the word matter is quite legal. Now, what you said before was so true. We can talk to some people, but when some people read it and then overnight, maybe 7.15 the next morning, matt, don't lose them. Well, timings kicked in, facts have kicked in, emotions kicked in and suddenly you're a professional negotiator. When I read that letter when you first did that it was the executive summary and wrap-up I could see all the things you do and say in this final grand finale.
Speaker 2:I might need that if people are getting divorced or separating or something like that, where I might have a stronger relationship with one rather than the other, or it's just one of those people that just don't listen in general and if I firmly believe it's a very good price or where we need to be or whatever it's in their benefit to move, then I'll probably give them that letter. But I don't need to use it all that often, maybe once every few months.
Speaker 1:Well, Matt, we've covered an enormous amount of information. Our listener needs to go back through the program, understand the concepts, stay clean. Is there any final advice you have for our people that want to be premium negotiators?
Speaker 2:I think the thing that I've learned over the years is you have to practice. You really need to practice the actual likely scenarios that you're going to come up with. Like I have been role-playing with myself for 10, 12 years. Like and I don't mean religiously like, even in the when I'm driving around the car, I'll be practicing a likely negotiation scenario. So, like I said before, it is a chess game. It's it's chess game. There are great chess champions and I always think about. You know, in anything there's always a few people that do extraordinarily well. It's not necessarily that they are more talented, it's just that they've dedicated themselves to the journey. And I want to be known as a great negotiator and the only way to get great at it is to practice it. I don't want to play on people's homes that are real, a real scenario. I want to be well-versed in, you know, in handling their home the best way.