5 Negotiating Tips for Newbie Investors

The thought of negotiating a purchase or sale is frightening to most newbie real estate investors. "I don't know anything about sales or negotiating, I just want to wholesale properties" you might be saying. "They didn't mention that in the 2AM infomercial I watched."

When you first learn about all the wealth to be gained in real estate investing, no one tells you that you will be sitting across the table in deep negotiations with people to try to convince them that you have the best answer to help them get out from under their problem property. But that is exactly what you will be doing. For many new investors, this is pretty scary stuff.

If you feel your negotiating skills are slim to none, here are five pointers that may help see you through.

1. Study Sales Techniques

If there is something you don't know - take the time to learn. After all, isn't that what career training is all about. Your local library will have books and CD's by such greats as Zig Ziglar, Brian Tracy, Og Mandino, and others. A couple of months of this kind of teaching will get you over the first hurdle in basic real estate negotiations. From there determine to continue learning.

2. People Over Property

Never forget that behind every property there is a real live person. If you understand you are in the "people" business first, negotiations will become much easier. Talk with them as you would a friend. Your goal is not to con them, but to help them. Work with them with utmost integrity and never make promises you cannot keep.

3. Listen

This pointer is closely related to the one above. If you learn to listen, you will learn the source of the potential seller's pain. Has an unwanted property been left to them by a deceased relative? Are they trying to unload rental properties they no longer want or need? Are they embroiled in a bitter divorce? The more you learn, the clearer your solutions will become. Again, this is a person, not a property.

4. Rephrase Their Statements

As the person is talking, take the problem they are relating to you and rephrase it. This confirms that you are listening and that you understand their problem.

If they have just told you there's no way they can keep up the payments in addition to making the necessary repairs, you may want to rephrase that statement:
"If what I am hearing is correct, you would be in a position to work with someone like me who is ready to take your house as is, and help you out. Is that correct?"

Practice doing this with several of their statements. Soon they will be agreeing with the solutions you are presenting.

5. Know Your "Walk Away"

Remember the old Kenny Rogers song The Gambler?
You got to know when to hold em, know when to fold em, Know when to walk away and know when to run.

Never go into any negotiation session without knowing beyond the shadow of a doubt at what point you will have to walk away (or run). If you have any compassion at all, you will want to help folks, but don't let your emotions override your business sense. Otherwise you will wind up in a deal that will not benefit you, the seller or your potential buyer. You are running a business not a charity. Help as much as you can, but do it without compromising your real estate investing profit margin.

Conclusion

Negotiating is a learned skill. Much can be learned from the experts by listening to teaching CDs and reading good books. But the best way to learn is to get out and do it. The more you get involved with people, the less you will struggle with emotions of fear and intimidation. Make sure you enter into each negotiation by knowing ahead of time what you want. With your goals in mind, and your focus on helping people solve their property problems, you'll soon become a natural in negotiating, and your real estate investing business will flourish.

Article Source: http://www.propertymagnate.com/articles

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