The No. 1 Most Important Factor to Win Any Negotiation

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Do you know who you’re negotiating with? Knowing is non-negotiable. Here’s why.

You have to be aware of who you’re communicating with for the negotiating process to be effective. This notion transcends any industry, any real estate niche, and communication in general—but it’s especially the case when negotiating.

Let’s discuss this in relation to real estate. When working on deals, communication is key. When I was a one-man show wholesaling, I spent a lot of time studying behavioral psychology in reference to buying habits and negotiating. Voice inflection, mirroring, and triggering are some of the techniques I discovered in my studies.

What are your strengths as a communicator? And how much do you know about the person you’re speaking to? Without going into some really nerdy and scientific stuff, I learned that for best results, you should try to identify the personality type of the receiver.

Why Is It Important to Negotiate?

Becoming a successful real estate investor requires landing the best deals. And those deals are never the first offer. It can be hard to build your negotiation skills, but start here: You’re looking for a win-win—and you winning is 50 percent of that success.

The first offer is never the best offer. You can usually get a lower price or a better deal by following a smart negotiation strategy. You’re not being a “bad guy” because you aren’t saying yes right away. Yes, the art of negotiation might make you nervous. That’s expected! But seeking better terms or a discounted price is nothing to be ashamed of. You might even help your negotiating partner achieve something they want, too!

The Impact of Personality Types on Negotiating Styles

During my studies and after hours of application (actually talking with sellers), I mastered the art of closing deals over the phone without meeting the sellers (or walking the property!)—critical skills for anyone who is looking to increase deal flow and maximize time efficiency.

In order to understand sellers, I learned how important it is to know who you are talking to. Pay careful attention to the first impression you receive. To set yourself up for a successful negotiation, learn the psychological patterns of the seller and their personality type. However, this is can be difficult if you are unaware of what to look for.

As you may know by now, it’s not a one-size-fits-all approach when speaking with sellers. Some sellers are more personable, while others want to limit the chit chat and get right down to business.

So, how can you tell who’s who, and how do you steer the conversation to accommodate the different personality types of sellers? Below is an outline of each type and suggestions for dealing with each.

Related: 8 Negotiation Techniques That Will Help Every Newbie Land a Better Deal

Personality Profiles & How to Negotiate With Them

Successful negotiators pay careful attention to the personality profile of their negotiating partner. After all, there’s no one-size-fits-all strategy. Use common sense and conventional wisdom to tailor your discussion to your partner.

The Red personality

1. They wear their emotions on their sleeves and will tell you right away what they want to accomplish.
2. These have nothing to hide.
3. They tend to use slang and may even curse.
4. They want to transact with someone who is a friend first, because they believe a friend wouldn’t let them down or steer them wrong.

Tips for dealing with Reds:

• Be prepared to get sidetracked in the middle of conversations in order to earn their trust and business.
• If you are normally very professional, you’ll need to let your guard down a little and use first names.
• Look out for common interests—finding a shared passion can help you gain their trust.

The Blue personality

1. They have no idea what they want.
2. They are emotionally open and willing to share personal stories of heartbreak.
3. They are the gazelle of the safari—very jumpy and scared off easily.
4. They are very loyal, and once they make a decision, it’s worthwhile.
5. They are very family-oriented and have a people-first mentality.

Tips for dealing with Blues:

• You have to define what they want for them, because they are seeking help.
• They need to be coddled. Slow down, take your time, and lead them to safety.

Related: How to Use Interest-Based Negotiation to Close True Win-Win Deals

The Green personality

1. They keep their cards close to their chest and want to receive an offer first in order to make a decision.
2. They aren’t looking to make friends.
3. They consider this a business decision, and the numbers are what matters most.

Tips for dealing with Greens:

• This personality is a heavy shopper with little loyalty—be on your toes.
• Ask for a specific goal. Be direct: “What is a reasonable offer for your property?”

The Brown personality

1. They are closed off emotionally, direct with their goals, and all about the bottom line.
2. They are typically professionals or entrepreneurs with limited time.
3. They aren’t looking for new friends.

Tips for dealing with Browns:

• Let them know up front whether or not you can help them accomplish their goal.
• Always be prompt.
• Build business rapport, not personal.

These may be generalizations to some extent, but this is what I’ve learned and have seen in years of negotiating real estate. Once you’re able to identify who you’re speaking with, you will absolutely be able to close more deals.

Do you have other traits and triggers that can help close deals?

Please share in the comment section below. 

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.