By Dale Beaumont
Let's do a quick test!!
1. What is your hourly rate?
2. Now divide that number by 60 and what do you get?
That's the value of your time every minute. If it's more than $1.00 you're doing well. However, how would you like to increase that figure to $100, $1000 or even $10,000 per minute? Well you can, simply by learning the art of how to NEGOTIATE. As real estate investor Hans Jakobi says, "NEGOTIATION Is The Highest Paid Work You'll Ever Do!"
A new book titled: 'Secrets of Property Millionaires Exposed!' takes people up-close and personal with eleven of the country's most successful property investors, including John Fitzgerald, Hans Jakobi, Ed Chan, Dymphna Boholt, Gordon Green, Craig Turnbull and others. In a surprisingly candid way each contributor shares their own unique wealth strategy and dozens of hints and tips from their years of experience.
The following six (6) points are the author's perspective of the contributor's views on the subject of 'The Psychology of Negotiation'.
1. Understand where the money is made
All successful property investors know that the money is made when they 'buy' and not when they sell. Buying at wholesale or 15-20% below market value is like adding rocket fuel to your portfolio's growth. By buying below market value you instantly build significant equity in your investment. You can use this equity to move onto your next property faster, or perhaps to fund renovations which in turn increases the property's value even further (more equity) and enables you to receive a higher rental return (more income).
2. Know that the deal you do is the best deal for them
Remember that if you come to a deal with the vendor, it was the best deal they had on the table. So by doing a deal with them, you have in fact helped the vendor take the property off their hands and you've paid more than what others could afford to pay. By understanding this you will make a small yet significant shift in your psychology when negotiating on a property. By having the mindset that you are there to help the vendor out of their predicament you'll be less inclined to become emotionally involved in the negotiation.
3. Get to know the vendor's needs
Although it is true that in negotiation 'information is power', it is information about the vendor's needs that will help you to reach the best deal for both parties. If you can find out the real reason why the vendor is selling, you'll know how motivated they'll be to accept your low offer. What's more, by asking questions, you'll be in a better position to offer more favourable terms and conditions. So show interest and ask questions!
4. Don't act too keenly on a property
When talking on the phone or while doing a house inspection, a trained real estate agent will ask pointed questions of you to extract information which may later be used against you to lever up the price. When this happens stay neutral and even a little nonchalant. But be careful to not come across as disinterested, otherwise you wonÕt be seen as a serious contender and you'll be left out of the communication loop. So stay relaxed and cool but with your eye on the ball.
5. Never lose your cool
Keep in mind that you'll need to be communicating with the agent and vendor over the entire length of the contract, which could be up to 90 days or more. So it's imperative you stay consistent and refrain yourself from sudden outbursts if something doesn't go right. Remember if the vendor believes they have been taken advantage of or felt offended, even the smallest request by you will be seen as an opportunity to get even. It's called human nature!
6. Be prepared to walk away
Sophisticated investors understand the deal of a lifetime comes around once a week, so don't be disheartened if one slips through your fingers. Take some time to sit and think about what happened and what you can learn from the experience. Then get on your feet and keep moving, because another deal may just be waiting right around the corner.
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About the Author
Dale Beaumont is a young entrepreneur and the creator of the 'Secrets Exposed' series. Having now released over 15 best-selling business books (available in bookstores across Australia or from www.SecretsExposed.com.au). Dale has been featured in all forms of the media and has become a sought-after speaker. To discover more about Dale's books, read his blog or to download other free articles and resources, please visit: www.DaleBeaumont.com
Photo: Courtesy of www.mastercleanco.com
Negotiation: The Highest Paid Work You'll Ever Do
