So you’re entering into negotiations to buy, sell, or lease a property, and you want to get the best deal that you can, while at the same time, you want to set the proper tone for negotiations. Because ideally, you’ll want the person on the other side of the negotiations to perceive you as being both interested and fair.
But with this in mind, when someone submits a ridiculously low offer on a property, or asks for something during negotiations that truly indicates that they’re primarily interested in getting a pound of flesh out of you, this can really serve to kill the negotiations immediately. Because who really wants to deal with someone who seems to be motivated primarily by their own ego, and their total and complete selfishness, unless you really have no other viable options?
One of the first things that you’ll want to keep in mind, is your bottom line for where the deal needs to happen in order for it to still work for you. Because sometimes principals can get so wrapped-up in the emotion of the negotiations, that they can end up making a deal that they otherwise would have passed on, and there is probably a no better example of this than what can happen sometimes during auctions. The two principals continue on in bidding against each other, getting so wrapped-up in wanting to beat the other side, such that when the gavel finally comes down and the judge or auctioneer yells out “sold”, the winning bidder then wonders what the heck they’ve really gotten themselves into!
So pertaining to your own situation, ask how important it is for you to make this deal, and if you end up not making the deal, how good are your alternative options if you’re just willing to walk away from it? Because if this is a deal for a property that you know will be hard to find, and you really, really want it, don’t let your ego get in the way of paying maybe just a little bit more than you wanted to. Because 10-15 years from now you’ll still be thrilled with the property, and you’ll laugh at the idea that maybe you paid just a little too much for it.
However, if there are comparable buildings that you can buy for a better price, or if you’re an owner, and you feel confident that you can sell or lease your property for a better rate to someone else soon, then you can feel justified in just passing on the deal instead. Either way, when you’re negotiating, understand what your alternatives are, and what the supply and demand within the current market is, and this will then help you to make the decision that’s truly the best one for you.
