Negotiations

By Larry Schottenstein on December 29, 2009

I was representing a buyer who was ready to offer $960,000 for a home that was listed at $999,000. (from our research it was well priced at $999,000 and a very good deal at $960,000) The home was originally listed at $1.3M and was on the market for over a year so the listing agent was very motivated to move it. It was listed by the #1 agent in the market area. She had a team of agents working for her and she was great at making it rain clients. Before we made an offer I asked her about any activity on the home and why it hadn’t sold yet. I didn’t tell her what we were thinking of making an offer because I like to control the flow of information. She went on to tell me how it was recently in contract but the buyer couldn’t sell their home and the deal recently fell apart. She then went on to add, “It was in contract for $950,000, oops, I guess I shouldn’t have said that.” My buyer didn’t have a home to sell and was in a strong position so with that knowledge we adjusted our price to $940,000 and they took it without countering.  I don’t know what she was trying to acheive by her comments. They were not necessary to sell the home.  We were ready to write an offer for $960,000. Her comments did cost her seller $20,000. She is great at getting listings but is she really great at negotiating for her clients? I personally think she was more interested in closing the deal and getting paid. (What she should have done was asked me questions about my client and our interest. She also had no obligation to tell me about other deals that have fallen apart)

 When negotiating a real estate transaction you want your agent to be carefull about the flow of information. When I am working for the seller I view this as important as marketing the home. Afterall, isn’t this what you are paying for? To have an agent knowledgable about negotiations and understands how to protect your interest. When I am working for the buyer my goal is to see which listing agent will tell me things they shouldn’t and to keep them in the dark about my clients motivations.