Oftentimes it has been that the art of negotiation is akin to the art of war. On many levels, there is some truth in this statement. The famous Chinese commander, Sun Tzu, studied the art of war at length and concluded that there are five elements that must be mastered in order to wage war successfully
Of course, on the surface it may appear that the five elements so closely studied and discussed by Sun Tzu have no actual relevance to real estate negotiation. However, upon closer examination, actual commonality can be found. In point of fact, when it comes to the art of real estate negotiation, it is wise to keep the five elements of war in mind.
As you work to close a real estate negotiation, you are well served to understand how the five elements do have an actual relationship and bearing on your chances of obtaining a solid, good deal when the ink dries on the contract and title.
Oddly enough, war has been called an extension of politics by many philosophers the world over. Politics does play a definite role in real estate negotiations. Politics, more than anything else, is the art of compromise, the art of give and take.
When it comes to preparing for a real estate negotiation, you need to map out those points and elements that are important to you and you need to determine what issues really do not matter in the greater or overall scheme of things. By being prepared in this manner, you will not be caught off guard during real estate negotiations. You will be able to compromise when necessary and hold your ground when you must.
Before you walk into a room to begin negotiations over a piece of real property, you need to understand the prevailing climate. Quite like Sun Tzu or any capable general evaluates prevailing weather conditions before marching onto a battlefield, you must assess what the real estate climate is at the point in time you initiate negotiations. Obviously, when it comes to any specific real estate market, there are instances when that particular market favors a seller and there are instances when that particular market will favor the buyer. A failure to understand the prevailing market conditions before you walk into the room to start negotiations will leave you vulnerable and incapable of fashioning the best possible deal in light of current real estate marketing trends.
Before initiating negotiations, you must make certain that you are fully educated in regard to the parcel of property that you intend to buy or sell. Many people involved in real estate negotiations make assumptions about the subject property. In the end, assumptions can be extremely dangerous.
Therefore, before beginning a round of negotiations over real estate it is vital that you do your homework about the property itself; in other words, you must make certain that you are knowledgeable about the terrain.
In the final analysis, real estate negotiation involves the dynamics between the individuals at the table. As a result, you should take the time to find out some basic information about the other party or parties to a negotiation. For example, if you are seeking to purchase a piece of real estate, you need to understand why the seller the commander across the table from you is seeking to unload that piece of real estate. By understanding the motivations and goals of the other party, you will be in a stronger negotiation position.
In advance of commencing real estate negotiations, you need to have formulated your own set of goals and objectives, your own doctrine relating to either the ownership or disposal of real property.
In order to gain an upper hand in real estate negotiations (and in order to make real estate ownership profitable in the first instance) you need to have a set of objectives and an action plan; a useable and responsible doctrine.
A person who approaches the buying and selling of real estate in a haphazard fashion will end up with a messy and oftentimes financially ruinous investment portfolio.