“No effort is wasted, though some may pay dividends later than you think. There is no such thing as “waste” in the Universe. Everything – everything – yields benefit.” – Neale Donald Walsch
As a real estate investor and mentor I've been through my share of offers and counter-offers when negotiating real estate deals. This a a quick real estate investing tip on “Standing Firm” on your real estate offers. Here’s a quick case study from one of my recent deals that I was involved with that will serve you greatly:
My student sent me a lead. I reviewed it and using my Max Offer Calculator, I replied with exactly what we needed to offer. She turned around and made the offer to buy a real estate investment deal in her area.
Seller flipped his lid.
You see, he wanted $80k… and not a penny less. We offered $60k. That was our max, and we knew it. But, my student is anxious
to get this deal. It’s a sweet deal – very high CAP rate and rate of return… perfect for a landlord. So, here is what I said:
“Hold your ground. Be firm. He’s desperate. He’ll come to you. Just be patient.”
Next thing we know, the seller wants to negotiate. He went from “$80k and no less,” to “let’s sit down and talk and see if we can
come to a compromise.”
We held firm.
In less than a week, he ended up meeting our price. He went from being offended by our offer, to feeling grateful we were actually willing to buy it.
That’s what desperation does.
There are two lessons here:
One, only deal with sellers in distress. And two, if you know your price ceiling, remain firm. The seller will meet you there.
Now get out there and flip something!