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"More Than Money"
Money is ahead of whatever is in second place. Or is it? Too often we assume money is the pivotal issue. We can resolve all differences with more money.
Each of us has a risk tolerance. There are buyers and sellers who will pay or receive five or six figures more or less for certainty. An offer with no financing or inspection contingencies may have more value than a competing offer.
It's often difficult to distinguish between the emotional and financial decision. The children have grown and the property is receiving little use. Financially, it makes sense to sell. Emotionally, it may be difficult to let go.
This is a particularly difficult decision for seasonal properties that have been in the family for multiple generations. The business decision may have been made to sell but there's pressure from multiple generations to retain the property. The compromise is an above market-listing price. This ensures the property will remain available for multiple years. It's both available and not available. The family's ambivalence, laid out for all to see.
The first question asked by all buyers: "How long has the property and available?" While the family is going through the painful process of letting go, buyers are calculating days on market. As time on market increases, selling prices typically decrease.
A better question for buyers is not how long but the frequency and the amount of price revisions. A property on the market for two years with three successive revisions in the last six months tells a different story than a property with no revisions.
If you're a seller, a buyer's initial offer can provide insight. When would the buyer like to close? What are the contingencies? If financing is a contingency, what is the percentage of the proposed selling price? The seller might be able to find out, if this is the first property on which the buyer is bidding. If not, what happened to the last sale/negotiation?
By having as much information as possible, a seller can tailor their counter to most closely meet both buyer and seller objectives. A counter only addressing price may be less successful than one that seeks to uncover the underlying motivation behind the buyer's offer.
Whether or not you are the buyer or seller, you will want to tie your offer to objective criteria favorable to you. If your seller, with few comparables, you might advance cost or replacement cost as objective criteria. If you're a buyer, attempting to justify your offer, you will want to assemble "comparables" to support your position.
Both approaches are self-serving with each individual advancing the "standard" to be used. Advancing a standard, however, will be more successful than submitting an offer or counteroffer not based on objective criteria. Wanting to sell for more or pay less, are not objective criteria.
There's always more than money. Buyer and seller should explore their mutual interests. There may be multiple opportunities for dovetailing these interests. In a successful negotiation both parties "win".
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