LAUNCH FOR

RE AL ESTATE BAS ICS NEW TO BUS IN ES S BR O KER S

MODULE SIX

D EVE LO PI N G T H E A RT O F N E G O T I AT I O N

A NOTE

from

We’re facing an exciting time within the real estate industry as the entire home buying and selling process goes through a transformation. Brokers who are seeking to learn, grow, and improve will thrive over the next decade and our commitment at RE/MAX Integrity | Northwest is to provide the environment and opportunities for you to build the type of business you’ve always wanted. Throughout this training series, you’ll find all of the components necessary to build a highly profitable, scalable, and enjoyable business. We look forward to being a partner in your development and the growth of your business.

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There are many decisions you must make each and every day to run a successful business. This program provides basic information to help you. Please note: The program and materials are designed as a resource to reference.

FOR ILLUSTRATION ONLY Certain sections of the materials illustrate how making changes to numbers, such as for costs and expenses, can financially impact an agent’s business. These sections are meant to be illustrations only and are not intended to be an exhaustive list of costs that may impact your business or to be specific to your situation. No promises, representations or guarantees of any kind are made about the success or profitability of your operations.

DISCLAIMER This publication is designed to provide general information in regard to the subject matter covered. It is presented with the understanding that neither the author nor the publisher is engaged in rendering legal or accounting advice or any other professional services. If such legal advice or other expert assistance is required, the services of a competent professional should be sought. Publisher and author cannot in any way guarantee that this material will be properly used for the purposes intended, and therefore, assume no responsibility for its proper and correct use.

CONFIDENTIAL Materials are confidential property. Any possession is considered to be a loan of assets and trade secrets.

REGULATIONS It is assumed that all agents comply with the regulations of the state wherein they are licensed. When cold calling, be aware of the requirements of the national (and, if applicable, state) Do Not Call Registry before placing calls. Additionally, be aware of federal and state laws regarding calling consumers before 8 AM or after 9 PM.

Latona Ventures, LLC DBA 300 NE 97th ST Seattle, WA 98115 1st Edition © 2021, All Rights Reserved. An Equal Opportunity Employer

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INTRODUCTION

We believe transforming the real estate lifestyle means that creating and building a successful real estate business is a deliberate and intentional process. For this reason, we want to provide you with the tried and true systems, strategies, and procedures used by the most successful Brokers we know. While there are many ways to expand a real estate business, this program is designed to get you started right... to LAUNCH your career and make sure you have a strong understanding of the basics. Think of it this way: your Real Estate Exam course work taught you about real estate law and theory. We are here to equip you with what’s needed to actually build a thriving real estate practice.

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THE EVOLUTION OF

NEGOTIATION

THE SALES MODEL OF THE PAST In previous decades, a Seller often had more information than the Buyer, yet the Buyer bore full responsibility to determine flaws and be aware of what they were getting themselves into. This is called information asymmetry, “knowing more about the product than the customer”. Results f rom negotiation were frequently one-sided – someone was going to win, someone else was going to lose. THE SALES MODEL OF TODAY Information has become so readily available that Buyers often come to the negotiating table well-prepared, educated, and empowered. Negotiations are now based on establishing a win-win outcome, not a win-lose result.

In the real estate industry, a cooperating agent should no longer be considered your adversary but rather your negotiation partner: a partner you need to work with, not fight against.

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NEGOTIATING AND LISTENING SKILLS Both sides of the transaction must be willing to actively negotiate to achieve success. Your first step to master negotiation is to become a skilled listener. Your attitude and actions are keys factors in this equation. Ensure that you approach all negotiations with an attitude of openness and honesty as you represent your client. z

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Set the tone early with your client that you are going to negotiate in good faith on their behalf. Show that you are interested in their point of view and position – understand their needs and wants and desires and fears. Be empathetic and sympathetic – allow your client to open up by genuinely listening and building rapport and understanding. Diffuse negative feelings – these include fear, suspicion, anger, aggression and distrust. Seek to evoke positive feelings – by building trust, comfort, and rapport.

Do wrong by a client and your business and reputation are likely to suffer. In the age of instant internet feedback, a bad social media posting can cost more than just that one sale to an unhappy client. By letting people know that you will listen and seek to understand their concerns allows them to relax and trust that you will guide them to a harmonious decision.

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HOW TO DEVELOP YOUR

NEGOTIATION SKILLS

When you develop trust with your client at the beginning of your relationship by using clear communication and listening skills, your client will have more faith in your ability to negotiate on their behalf once they are in contract on a purchase or sale of a home. They’ll naturally look to you for guidance and advice, which in turn will help navigate a deal easier all the way through to closing. It’s a win-win for all parties involved. NEGOTIATING TIPS z

Bring objections into the open so you can clearly understand them.

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Do not allow objections to draw you into combat.

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Remember people don’t always say what they really mean.

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Treat objections as signals.

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Listen objectively.

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Decide whether you want to make a sale or win an argument.

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Before responding, carefully listen and rephrase back to them, and ask if you understood them correctly.

Usually, we cannot talk people into changing their minds, but we may be able to listen them into doing so. People may become willing to change their minds if they feel you are really trying to understand them.

Here are some ideas to get you started as you learn the art of negotiation: VISUALIZE WINNING Imagine and savor the moment of bringing opposing parties to agreement. This mental exercise sets in your mind the feeling of accomplishing the strategy or tactic successfully. When the time comes to act, you will feel confident and natural in your role as negotiator. DESERVE TO WIN When setting your objectives and primary goal, test the terms against what you know to be reasonable. If reasonable, you can set aside doubts that you will fail to bring about a mutual agreement. Focus on bringing the parties together and a meeting of the minds. This form of mental preparation serves to establish your expectation that you deserve to prevail, that you should prevail. You are empowering yourself to prevail. PREPARE TO WIN Remind yourself to make direct eye contact to individual who is present. This is not the time to slight one of the decision makers.

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HOW TO DEVELOP YOUR

LISTENING SKILLS

Being a good listener is often more important than what you say. You can’t become a good negotiator without being a good listener. First and foremost, a good listener always maintains eye control. This does more than show the person you are interested. It helps you concentrate on what they are saying. Rearrange your seating if it prevents a clear line of vision, or if it is too noisy in the room. Do what you can to cut down on the distractions. This includes turning off your cell phone. There is no excuse for allowing your cell phone to interrupt a client. MORE KEYS FOR PRACTICING GOOD LISTENING z z

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Limit your own talking. You cannot talk and listen at the same time. Think like the person(s) opposite you. Their problem and needs are important. You will understand and retain them better if you keep their point of view in mind. Ask questions. If you don’t understand something—or feel you may have missed the point—clear it up now. Don’t interrupt. A pause—even a long pause—does not always mean they have finished sharing what is on their mind. Concentrate. Focus your mind on what they are saying. Practice shutting out outside distractions. Take notes. This will help you remember important points. But, be selective: trying to jot down everything they say can result in being left far behind or in retaining relevant details. Listen for ideas, not just words. You want to get the whole picture, not just isolated bits and pieces. Listen for the overtones. You can learn a great deal about people from the way they say things and the way they react to the things you say. Interjections. An occasional, “yes, i see” shows the person you are still with them, but don’t overdo or use a meaningless comment.

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Turn off your own worries. This is not always easy, but personal fears, worries, problems not connected with contact, form a kind of static that can blank out the person’s message. Prepare in advance. Remarks and questions prepared in advance, when possible, free your mind for listening. React to ideas, not the person. Don’t allow irritation at things they might say, or at their manner to distract you. Don’t argue mentally and don’t jump to conclusions. Avoid making unwarranted assumptions about what the client is going to say, or mentally try to complete their sentences for them. Practice listening. Make your conversations with your f riends, your family, the people who serve you in the places you shop, a tool for improving listening skills for “sharpening your inner ear”.

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HOW TO DEVELOP YOUR

LISTENING SKILLS

(CONT.)

SIX BAD HABITS TO AVOID 1. Do not “fake” paying attention. If you are guilty of faking attention while listening you deceive only yourself. 2. Do not be the “I only listen for and get the facts” listener. Ultimately you won’t remember half of the conversation. 3. Do not be the person who avoids difficult listening and tunes the speaker out because it is challenging to understand. 4. Do not prematurely dismiss a subject as uninteresting or not pertinent. 5. Do not criticize delivery and physical appearance. The content of a message is always more important than the form of its delivery. 6. Do not easily yield to distractions.

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Remember this illustration as you develop your communication and listening skills.

7%

Spoken Word

55%

Body Language

HOW A MESSAGE IS CONVEYED

38% Tone of Voice

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THE PATH TOWARD SUCCESSFUL NEGOTIATIONS A good negotiator works from a positive attitude and self-confidence. A confident, positive attitude does not come to everyone naturally and there are ways to reset your mindset to be positive and create a positive demeanor. The following practices will help you become a good negotiator for your clients. z

Ask questions and listen to their responses.

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Ask follow-up questions designed to cross check previous answers.

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Seek similar responses from everyone involved.

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Feel free to question the responses.

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Press to discover what the true concerns may be.

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Identify if there are needs not disclosed.

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Gather and digest the responses to create the ‘fabric’ of the basic needs and stated wants regarding the situation. Observe non-verbal reaction that may indicate responses are less than forthright.

REMEMBER Successful negotiation includes knowing the right time to ask for a decision. It is not a separate step but a natural step in the selling process. People will be ready to move to a decision if the following has happened: z

You know the real decision maker is at the table or easily available for discussion.

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You have asked trial-closing questions to get opinions and response.

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You listened and reinforced each response.

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You restated how the benefits will outweigh the costs.

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You asked for a decision.

If the client is unable to provide a decision, then ask: z

At this point, what other questions do you have?

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What other information do you need?

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Is there anyone else with whom you need to consult before making a decision?

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Have I met all your decision criteria?

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Have I successfully answered all your concerns?

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EVALUATING THE NEGOTIABLES This chart can help you gain a clear picture of what is at stake for whom when presenting an offer. Your contract negotiation process begins by understanding this scenario from both sides. Your ability to comprehend the goals of each party will strengthen your ability to negotiate for your clients.

BUYER PRICE TERMS CONCESSIONS

CONDITIONS

REPAIRS CLOSING DATE

SELLER

How much is the Buyer willing to pay?

What is the Seller willing to accept?

How will the Buyer purchase the property?

Is the Seller comfortable with how the Buyer is purchasing the property?

Is the Buyer asking for concessions f rom the Seller; if so, how much?

Is the Seller willing to contribute to the Buyer’s costs?

Are there items of personal property the Buyer wants included in the offer?

Has the Seller included any personal property or willing to include any in the sales price?

What does the Buyer want?

What is the Seller willing to provide?

When can the Buyer close the transaction?

When can/will the Seller close the transaction?

People trust what you say only after they trust you. Genuinely strive to create value to your client: remember, they are not just interested in the price -- what they really want is to achieve their definition of value in this scenario.

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WHEN IS NEGOTIATION OVER? What are the signs that a negotiation is over? z

You understand what they want f rom the transaction.

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Their concerns and/or objections have been identified and addressed.

When the above is accomplished, your clients will be ready and able to move forward, or it will be clear they are unwilling to proceed. Their confidence at this point, and their ability to express it to you, will largely be due to how successfully you understood their needs and addressed their concerns in a manner which was meaningful to them.

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FOUR COMMUNICATION STYLES Our communication styles affect how others react to and perceive us. Sales have been lost for no other apparent reason than due to a lack of communications between the agent and their clients. To be a good communicator it is important to understand and identify not only your communication style, but those of your clients. When dealing with more than one client, such as a husband and wife, you may be dealing with two different types of personalities and communications styles. It is important that you blend your style with both of theirs - become a chameleon. In truth you are not just one of four styles, but a blend of all. You should also be aware that under stress, communications may change somewhat. Being prepared to communicate effectively can move negotiations along more smoothly. For example, if you are by nature less analytical and you have an analytical Buyer, you should be prepared with facts and stats before writing an offer. Knowing your communication style and knowing how to manage others’ communication styles can reduce conflicts, increase productivity and improve teamwork with your negotiations partner.

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THE SOCIALIZER

THE DIRECTOR

Socializers are influential, intuitive, inspirational, emotional and natural born salespeople.

Directors are self-assured decision makers who value results, like being in control, and can appear to be quite blunt or not appreciative of other’s feelings.

The Socializer is approachable and non-judgmental, f riendly, outgoing and animated. They tend to be high on energy, speak quickly and focus on the big picture. Socializers may find conflict or differences in opinion to be invigorating and while appearing strong, they often seek approval, and seem overly cheerful, vain or unpredictable. The Socializer worries about rejection and looks for reassurance.

They are generally brief in conversation and often multi-task. They often see the big picture and may be more focused on outcomes than process. Directors want to be charge, they want direct answers and want them immediately. They can appear opinionated, intimidating and overly self-confident.

THE SUPPORTER

THE ANALYZER

Supporters are steady, consistent individuals who seek stability and security; they are loyal, supportive, easy going. They will frequently focus on people and relationships and are generally concerned with everyone’s needs.

Analyzers are conscientious, conservative, logical and may appear to be un-emotional decision makers. They look for facts, seek accuracy, strive for order and are cautious perfectionists who like to analyze information and to recheck all of the details. Facts and statistics determine their decisions.

Supporters are often detail-minded and support decisions rather than make them. They may find sudden change upsetting and tend to feel uncomfortable in conflict, fearing a loss of security. Supporters may also be perceived as procrastinators when distracted.

Analyzers focus on the facts and details and not on the big picture. They’re generally not comfortable with conflict and can be perceived as unemotional or nonchalant. They are slow to commit and will be uncomfortable if they feel

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YOUR COMMUNICATION STYLE It is important to recognize your communication style to be effective in connecting with your clients or the negotiator on the other size of the table. You may feel that you are a specific style, or blend of styles, but remember it is most important to be aware of how you are perceived, and how much you can adapt or adopt in the course of negotiations. You can avoid conflict and misunderstanding by paying close attention to how those around you are communicating. It may be verbal or their body language. If you sense an imbalance, then adjust the way you’re communicating either verbally or physically. If you have crossed a person’s comfort zone, step back and listen to them. Stop talking, listen and observe. YOUR NEGOTIATION VOICE Your set of negotiation skills have developed since you were born. They are learned and refined continuously. Among these perhaps the most important is the way you use your voice. A confident, positive, collaborative attitude can be communicated through your voice. This does not come to everyone naturally and you may need to consciously develop it over time. Consider these types of “voice: or tone of voice: 1. ASSERTIVE This delivery is unfiltered, with little regard to reaching an agreement with the other side. It is not advisable and can be counterproductive. 2. ACCOMMODATING This should be your go-to voice. It sounds believable, calming, and truthful; it delivers a message in a comfortable and collaborative way. 3. SOOTHING This voice is delivered at lower volume and slower pace and can makes the other side feel less threatened and required them to pay closer attention. It may be effective when negotiations have stalled.

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In addition to the three tones of voice there are two important inflections of speech which you can be aware of and develop in your negotiation skillset: 1. INQUISITIVE This inflection conveys a sense of curiosity and interest. It comes across as if asking a question with the tone of voice being “upward.” This should be your predominate inflection when speaking. 2. DIRECTIVE In contrast, this inflection is downward, construed as “just the facts.” Your counterpart is likely to mirror your expressions, for instance, if you are negative or hostile, your counterpart will respond similarly. On the other hand, when you are calm and non-threatening, they will often respond the same way. It is important to project a voice that inspires trust and moves the conversation forward.

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WRAPPING UP I understand the negotiation process. I have practiced my listening skills.

NOTES

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FIRM BELIEVERS that anyone can learn f rom everyone, we strive to create a friendly and supportive atmosphere where community, curiosity, and creativity are all nurtured to allow for successful entrepreneurial collaboration. We also understand that real estate growth, is all about personal growth so the staff constantly works at developing ideas, tips, and tricks that will help de-clutter and de-stress our Brokers’ lives.

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