The Art of The Deal - Negotiating Strategies

[Todd Whiddon]

Just listed a new rehab project for sale Friday at 155k, received an email this morning from buyers agent saying client is interested but "only approved" for 146k and needs 7k closing cost.

We are still making a killing selling for 139k but don't want to take their 1st offer.

Question: Do you prefer to take your money and run, negotiating instead with items like fast closings or short due diligence periods. Or if you want to play the numbers game, what is your typical offer / counteroffer strategy on flip SFHs.

Thanks!

[J Scott]

Personally, I don't need to squeeze every dollar out of my buyers. If the purchase price and closing costs allows me to hit my profit target, I generally won't negotiate those terms.

That said, psychologically speaking, it's generally not a good idea to accept an offer without any negotiation. It generally makes the buyer feel is if their offer was too high (why else would you have accepted it so quickly?), and they will approach the entire transaction as if they are getting the losing end of the deal.

So, that said, I like to negotiate the other aspects of the deal that are important to me. I'll try to get them to use my lender (though don't require it), will try to negotiate higher earnest money, will try to shorten the closing period, will try to get them to use my closing attorney, will ask them to shorten their contingency periods (due diligence and financing), will let them know that we won't be make any additional cosmetic repairs after the inspection (i.e., "we'll accept your first offer price, but don't think you can get us to spend more money that doesn't need to be spent..."), etc.