A Different Negotiation Technique when making Offers

Learn more about investing in Australian real estate & share your ideas with other investors.
Post Reply
kathryn
Posts: 13
Joined: Wed Jul 21, 2010 7:06 pm

A Different Negotiation Technique when making Offers

Post by kathryn »

On the weekend I was at a property seminar and I heard a strategy that I had never heard of before when it came to making an offer on the property.

Traditionally when you make an offer to an agent, this can be done verbally and a phone call can be made and a yes or a no is decided. Some people will ask for some conditions to be added to the contract, however this is sometimes when the vendors feel like they are at risk and don’t accept the i offer. However if all goes to plan after that conversation, then the paperwork comes out.

I have over the years heard of written offers with a condition or two attached by not numerous offers at the same time. Cherie Barber suggested giving the vendor 4 options on what they are will to agree to sell their property. If the property was on the mark for $650000 your offer may look like this.

Option 1 –$600000 unconditional

Option 2 – $620000 with building and pest reports plus bank approval

Option 3 – $640000 with building and pest reports, bank approval, early access and minimal deposit

Option 4 - $655000 with building and pest reports, bank approval, early access, minimal deposit, 5 months settlement and DA approval.

Now of course the vendor is going to want to have the $655000, but 99% won’t want to agree on the terms and conditions, hence there are the other options. So they may need to consider the other options. Has anyone done this option strategy before?

Happy Investing

Kathryn

aznpride303
Posts: 2
Joined: Mon Jul 09, 2012 8:58 pm

Re: A Different Negotiation Technique when making Offers

Post by aznpride303 »

I have not done this offer strategy before but I am a very experienced investor. There is nothing wrong with making this kind of offer but you also need to consider whether you want to expose yourself to these conditions. Dont forget that you are the other side of the contract. Are making such big differences in price for the condition worth that much to you?

At the end of the day, any real estate deal is a deal between 2 parties. You both need to be satisfied with the result.

Post Reply