In order for a real estate transaction to be successful, both parties must be determined and willing to negotiate. In other words, it isn’t often that the perfect home comes up in a search that has everything you want at the perfect price.
Negotiation is Very Important
If you are looking to buy a home right away, working on your negotiating skills and knowing where to begin will be key in order to land the lowest price without pushing things too far. You will first want to get familiar with the market conditions and understand the steps involved in a real estate transaction.
Familiarize yourself with the market area and prices to determine what is considered reasonable as well as determining your counter-offer. But if it’s a seller’s market (where there are more buyers than homes on the market), the seller probably won’t be as flexible to negotiation, so keep this in mind when determining your strategy.
Within each real estate transaction, there are numerous factors to be considered and it’s almost impossible to predict the nature of the negotiation before it happens. But there are key strategies to be aware of so you can best prepare yourself and avoid any mistakes that can end up costing you for the next 15 or even 30 years.
Be sure to avoid the following mistakes during a real estate transaction:
Make sure to avoid these mistakes when buying or selling your property.
- 1. Being afraid to lose the deal
- 2. Being too greedy
- 3. Only focusing on price
- 4. Prioritizing your needs
- 5. Threatening with an ultimatum
- 6. Taking control of the situation
- 7. Not controlling your emotions
- 8. Overreacting to their offer
- 9. Being nervous about your image
- 10. Being overconfident
1. Being Afraid to Lose the Deal
Even if you find the perfect home, you should never be afraid to lose it. Being too determined can only lead to disappointment and missing out on better opportunities. Even if you feel regretful about losing the property for whatever reason, your gut feeling will probably tell you that it wasn’t worth it.
But do keep in mind that you and the buyer or seller are both looking to make the transaction successful; therefore, as long as you are both determined, it is likely that you will both “win” in the end.
2. Being Too Greedy
Nobody will want to make a deal that doesn’t meet their best interests. In fact, being too greedy can actually push people away, causing you to miss your highest bidder or lowest offer because your pride took over. Make sure to consider all offers and stay reasonable with prospects.
3. Only Focusing on Price
Yes price is a big factor but it’s not the only one. If you make this mistake, you could be missing out on some opportunities for a great deal. If you’re the seller, consider adding in some other assets like furniture, washing machine, or refrigerator to make up for a higher price. If this doesn’t interest them there are a number of other terms that can be negotiated in order to get the price you are looking for.
4. Prioritizing Your Needs
Of course everyone will think about how they can benefit from the deal, but they make the mistake of not taking the other party’s interest into account that makes them lose it. To avoid this, get to know the other person and what is important to them.
By learning about their wants and needs, it’s more likely that you can negotiate a deal that will work in both of your best interests.
5. Threatening with an Ultimatum
Getting hasty to end the deal with an ultimatum can be tempting, but always consider stopping the negotiation. Being overly aggressive during the transaction can end up in an accepted but regretted contract or cause the deal to fall through.
In the worst case scenario, they may respond to your aggression by taking legal action because they may feel backed into a corner. Surely you wouldn’t want to feel this way, so it’s best to avoid it altogether.
6. Taking Control of the Situation
It’s common for parties to take control of the situation which gives them the feeling of having the upper hand, but it’s not often that they consider how it will affect the other person. The deal will most likely end up falling through because they feel weak or have no control.
Instead, show that you can be humble and allow them to take partial control. This way they can feel confident that they are making the best decision and end up in a fair deal between both of you.
7. Not Controlling Your Emotions
If the other party sees that you are becoming emotionally attached to the deal, they will feel more inclined to negotiate terms in their favor.
To avoid this mistake, make sure that your emotions are contained before entering the deal; it is important to care, but not too much. Be sure to write down any alternatives to the situation in case an agreement cannot be made. This way you will have some other options that can still give you a fighting chance without letting your emotions take over.
8. Overreacting to Their Offer
Even if their offer isn’t anywhere near what you expected, read through the details before reacting to it. They may be offering something else in exchange for the lower amount you were looking for.
Before entering the deal, clear your head and emotions. Then you can come up with a counter offer that makes sense for you.
9. Being Nervous About Your Image
Thinking about the wants and needs of the other party is important, but this shouldn’t deter you from making an offer that works for you. Regardless of the amount, make sure to support your decision with research and confidence about why you think it’s fair.
Even if the offer is low, tell them why, including facts from research and how it represents the market value of the property. If they are determined to sell the property, they will listen to your case and may even accept your offer because you did your homework.
10. Being Overconfident
It’s good to enter a deal with confidence, but too much can come off as conceited and have a negative impact on your ability to negotiate. Before making a quick decision to counter an offer, make sure that you have done all your research so you can support your reasoning.
A helpful tip would be to write down key points in the deal, bring notes, and practice what you will say. Doing this will show your professionalism, confidence, good reasoning, and minimize errors during the deal.
11. Not Working with a Real Estate Attorney
It can be tempting to save money by skipping out on working with a real estate attorney. But this can end up costing much more in the long run. Especially if you are buying your first property, detailed contracts can be misleading, boring, and difficult to understand.
But an experienced real estate attorney will know exactly what to look for, reading the fine print carefully, and “translating” the terms to give you an understanding of what you are signing. It has also been proven that working with an attorney can increase the chances of having a successful transaction which in turn serves both parties best interests.
Berry K. Tucker & Associates, Ltd.
If you are looking for an experienced real estate attorney, check out the law firm of Berry K. Tucker & Associates, Ltd. Our lawyers have not only overseen numerous transactions, but we have negotiated terms that proved to have successful results. Whether you are buying or selling residential or commercial property, we can negotiate the details as well as answer all of your questions, so you can make a decision with the confidence that you are getting a fair deal.
Our attorneys can provide all of the following:
Berry Tucker has years of experience with real estate transactions. Ask him how he can help you with the property you are looking to buy or sell.
- Explain the real estate transaction process and requirements
- Examine all real estate documents
- Register legal documents
- Ensuring legal ownership
- Handling issues with the title
- Drafting necessary documents for closing
- Handling negotiations
- Attend the closing meeting
Final Thoughts
Real estate transactions can seem straightforward at first, but they only get more complicated further into the process. If at any time you feel nervous or have questions about the transaction or legal process, don’t hesitate to reach out to one of our attorneys at Berry K. Tucker & Associates, Ltd. We will guide you through each step of the process and negotiate a solution that works in your best interest.
Give us a call at (708) 425-9530 to speak with one of our real estate attorneys.
Tags: mistakes to avoid during real estate transactions, real estate attorney, real estate law, real estate lawyer
