Some people are just difficult to deal with. At some point we have all dealt with people that are ornery, stubborn, unyielding, illogical, greedy, or overly emotional when it comes to a business transaction. Those characteristics are not usually conducive to completing a successful real estate deal.
Over the past few months I have personally been trying to buy a small farm in west Alabama, and the sellers have been down-right aggravating. A nationally-recognized brokerage had this farm listed. I made the sellers a 93% initial offer on the place. The sellers rejected the offer, and said that not only would they not accept my offer but they were also taking up the fences, the dog trot, removing the freezer, refrigerator, wall heaters, generator, and a few other items from their property. After I picked my jaw up off the floor, I told the listing agent that I would pay them the full asking price if they would leave the property as advertised.
The sellers came back with more objections. In addition to the full price offer, I agreed to give them a life estate in a portion of the property, would allow them to keep the generator, and would close at a time suitable to them. I put all of it in a written contract and delivered it to their listing agent. They held the written offer for 14 days before they finally rejected my offer and pulled their property off the market. I am still baffled by how stubborn the seller is being.
This failed attempt at negotiation, on my own behalf, has helped me learn some lessons that are beneficial to my other land clients. Here are a few principles I am taking away from this experience:
- Motivation Matters- If a party is not motivated to act in a transaction, they are much less likely to make significant compromises to arrive at a deal. If one party cannot be induced to act, then it is very unlikely that a deal can be reached.
- Emotions are Important- “It’s just business” may work on Wall Street, but in the real world, ordinary people mingle business and emotions. The word “negotiate” comes from Latin meaning “not leisure”. When a seller feels attachment to a property, they often assign unrealistic monetary value to their sentimental value. Sometimes when a buyer does not hear from the seller for a few days, they assume that the other person is trying to get over on them somehow. When emotion overcomes logic, then you have a situation that endangers the success of your deal.
- A successful deal cannot always be reached…right now. Every situation may not reach a positive resolution. Sometimes the best thing to do is to wait a little while. Circumstances change. Personalities soften as motivation increases. People usually act right when they need a specific result. Sometimes you have to take a crockpot approach to real estate transactions and not a microwave approach.
- Turn up the Heat- It can help a deal come together when there is some way to hold their feet to the fire. For instance, our company’s listing agreement has a clause that says that if we bring an offer that meets the seller’s objectives that they do not have to sell, but they do owe us a commission. At that point, we have done what they employed us to do. I do not know of a single transaction that we have lost when a seller has been faced the prospect of paying a commission and not selling their property. Having a way to apply pressure can help you achieve the desired result.
The real estate business is much more about dealing with people than real property. People buy land, people sell land. The land just sits there like it has for eons past. A dairy farmer told me once that “Common sense and common decency can solve most of life’s problems.” I wholeheartedly agree with his assessment. On certain occasions people act in ways that are counterproductive to their desired goal. Finding ways to deal constructively with difficult people will increase our odds of creating positive outcomes.
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