How To Never Split The Difference in Real Estate
Negotiation Tips From Never Split the Difference by Chris Voss
As a real estate agent, you need to know how to effectively negotiate with other real estate agents, sellers, and even your own buyers. In the book Never Split the Difference by Chris Voss there are a number of tips and tricks for real estate agents. Two of the most power concepts include Tactical Empathy and Calibrated Questions. These two parts to negotiation make the other party lower their guard and it turns the negotiation into a problem solving venture.
In this real estate agent training podcast, you will learn how to use Tactical Empathy and Calibrated Questions to negotiate your commission, with another agent, and with your own client.
[00:00:00] Hello and welcome to Rev Real Estate School. The podcast with quick tips and actionable advice to help you sell more estate in today's world. And now your host Michael Montgomery.
[00:00:11] Hello and welcome back to Rev Real Estate School. I'm your host Michael Montgomery. Today we are talking about getting what you want. Today we are using never split the difference tactics from Chris Voss his book on how you can get what you want in a negotiation.
[00:00:28] Now if you haven't read never split the difference definitely pick it up it's a great read it's on our list of 25 must read books for real estate agents all link all of those up in the show notes as well as never split the difference it is definitely worth a read as a real estate agent today we are going to jump in to a few of the big tactics that you can use from this book and how you can use them to your advantage.
[00:00:52] For this episode we're going to dive into three different negotiations that we may face as a real estate agent I shouldn't say may face. We will definitely face these three negotiations. Now two of them might sound very familiar to you but one of them probably doesn't. We're going to use the tactics in never split the difference to negotiate. First off with a seller when dealing with commissions next and probably the most common is we're going to talk about how he can negotiate with another agent when we're in a deal. And third this one might not come to mind right off the bat and we can use it in a few different situations is negotiating you as a buyer's agent with the buyer and you as a seller's agent with the seller. So what do I mean by this one. Well this is basically when you have a buyer that says look I just don't want to pay more than X or a seller that says I want to list up here when we actually need to be listed down here or better yet on a completely different planet.
[00:01:52] Let's jump into the concepts. The first one is Tactical Empathy. Tactical Empathy is when the other party feels heard. So it's our job when we're negotiating whether that be with our seller or buyer or the other real estate agent is we really want that other party to feel heard. Ideally we want them to say the words, "that's right". And in moving them towards saying this we want to really try to pick up on emotions and things that they really care and are concerned about during the negotiation so that we can move them towards saying those words. Now how do we get somebody to say that's right. Well basically we do need to listen to them and then we want to summarize back to them. And there are two ways that we summarize back to the person we start the sentence by saying, "it sounds like..." or "it seems like ...". Now this is a very powerful way of phrasing this sort of statement because you're not committing you're not saying with 100 percent certainty you're saying it sounds like or it seems like and then you follow up the sentence about certain things that are coming across in the negotiation that they care about following this. You want the other party to say that's right.
[00:03:08] So here's an example. Let's talk about a seller and commissions. This is one of the most common negotiations that happens in real estate is between us the agent and the seller when it comes to commissions. So let's say the seller is putting up a lot of objections around commissions. What you can say:.
[00:03:26] "Well Mr. and Mrs. seller it sounds like you really want to keep the most amount of money in your pocket at the end of the day". There is a perfect example right there. And then after that they're probably going to say that's right. If you've got them this far then you've already got them half the way through the negotiation or you can say, "it seems like the number one important thing for you is having the most money in your pocket at the end of the day". There's another example. So you're going it sounds like or it seems like and they're finishing that with. That's right.
[00:03:57] After that you move into what's called Calibrated Questions. Chris Voss calls us these Calibrated Questions because you're moving the person in the direction that you want to go and what you're doing with a Calibrated Question is you're turning the negotiation away from the feeling of a negotiation and into a problem solving opportunity. And you want to be using words like "how" and "what." What he recommends the absolute best calibrated question that you can use is, "how am I supposed to do that?" "How am I supposed to do that?" So in having the negotiation once they've said that's right. Then you move into the Calibrated Question with some version of how am I supposed to do that now. The thing about that sort of question is if you just come across with how am I supposed to do that that's a little bit aggressive if you ask me. So you still really want to value their intelligence and value what their issue is.
[00:04:55] That's very important at this stage. And this touches on one of the most certain things about negotiation in any case oftentimes what we want to do is we want to talk and we want to tell people and we want to show people. But in reality the best way to negotiate is with questions and that's exactly what's happening here. You're starting with tactical empathy saying it sounds like and then you're following up with calibrated questions so your negotiation becomes questions and it avoids you just going back and forth trying to tell people what it is that they need to hear and what it is that they need to know. Now this is a struggle right off the start. This is something I really struggled with because off the start I want to throw my hands in the air and say look this is just the way it is. I don't know why we have to go back and forth over this. But as time goes on in your career you'll start to understand that negotiation is all about questions. So now let's use these questions in our three different examples and how we can get what it is that we're looking for.
[00:05:55] So to kick us off we have the seller that's trying to grind us down on commissions and like we said off the start there. We use Tactical Empathy. "It sounds like you want the most money in your pocket at the end of the day." Following that you'll probably hear. "That's right." Then we move into the Calibrated Question. So the calibrated questions section is, "how am I supposed to do that," but if you just say that again it doesn't sound too great right. instead you want to be a little bit more understanding and strategic so you can say so, "how am I supposed to do that with a lower marketing budget and therefore less eyes on your home?" Then you give the seller a chance to respond. Now what could happen in this case is you could get somewhat of a counters they might say well I'm not going to pay you your full fee but how about X amount. Right which is still potentially not your full fee. So if that's the case you just go one step further. You start by showing generosity and then from there move back to how am I supposed to do that. So you could say, "well that's very generous of you but how are we supposed to proceed if not as many people do end up seeing your listing." So you'll see it's all coming down to questions is coming down to calculated questions on how you can deal with the other person.
[00:07:10] Next let's jump into if we're dealing with another real estate agent in these cases it's very important that you get the other person on your side. You really want to see eye to eye because at the end of the day you guys do have opposing forces as in buyer's agent wants the lowest price listing agent wants the highest price. However you also do have a similar role where you're trying to put a transaction together. Being on the same side is huge when dealing with another real estate agent. Let's jump in to an example let's say you are on the buyer side. There is a listing agent that you are dealing with. What you want to be doing here is again dealing with the person which is the agent and less so with the seller. You'd go with, "it sounds like you really want to get this deal done with the highest possible price, and on the best terms for your seller." They follow up by saying, "that's right." Then you can move into your Calibrated Question and say, "but how are we supposed to do that if the buyer sees this as being way above market value?" So a couple of things that were done there I'm talking to the agent directly so I'm saying how are we supposed to do that. I'm trying to make this more of a team and have that sort of mentality because I want that agent on my side to then go back to their seller and see if we can get them down. So that's the agent to agent example.
[00:08:29] Now let's talk about when you're dealing with a buyer or when you're dealing with a seller and you're trying to get them to see where the value is. So if you're dealing with a buyer it's not willing to come up above where they're at or a seller that's not willing to come down on the buying side. You'd say, "it sounds like what you're looking for is a property well below market value." They follow up with. "That's right." And then you can say, "but how are we supposed to do that when this sellers only willing to come into the lower part of the market value range?" So again strategically phrased in letting them know that they'd still be getting a deal because they're into the lower part of market value range on the selling side it could be where the seller is just not willing to come down on price in order to make this makes sense. So you would say, "it seems like you just want the absolute best possible price that you can get." They're going to say, "that's right." Then you move into your calibrated question and you can say but how are we supposed to do that when the comparables are selling for 10 percent less than we are. So those are your tips from Chris Voss his book never split the difference again in the show notes will link up our 25 must read books for real estate agents as well. We'll have the transcript in there if you want to go back into this and look at these dialogues in a little bit more detail. Thank you so much for listing this episode I really appreciate it remember all you have to do is write and review the show head over to our Web site go to the free coaching section and from there you can ask a top producer anything. Thanks again. We'll see you in the next lesson.
[00:10:00] This episode of Rev real estate school has come to a close. Thank you for tuning in. We'll see you back here. Next lesson.