This is how Prince William tried to fix his relationship with Prince Harry after their FeudMegan Elliott More Articles November 28, 2016 A ‘ For sale ‘ sign in front of a house David McNew / Getty Images Ideally you work with a reliable, professional real estate agent who can help you put together an offer that works for everyone. You also want to negotiate from a position of power and a new study by researchers at Leuphana University LÃ1?4neberg in Germany provides insight into how exactly that can be achieved by buyers. A very specific bid for a house “say an offer of $369134.50 instead of $370,000—gives you control over sellers in some circumstances that the researchers found. Our research shows that more precise opening prices will give you a major bargaining advantage, but you need to know who you are negotiating with, “one of the authors of the study said David D. Loschelder. “With amateurs this number should be very accurate; with professionals however negotiators should either choose a reasonable level of accuracy or back up their highly accurate number with a compelling reason.”

Power of accuracy A “Sale Pending” sign in front of a home Justin Sullivan / Getty Images Less experienced sellers perceive accurate bids as a symbol of the buyer’s knoo. Ironically, amateurs seem to think: ‘ Oh this number is so accurate that my adversary must have been worrying about a fair price quite a bit. He or she must be truly competent “said Loschelder. Super-specific deals are usually taken in by seasoned sellers. Explained a too-precise price would lead them to denigrate the competence of their competitor Loschelder. But if the buyer gives a reason for their particular bid, such as clear improvements that need to be made to home sellers, then the buyer will assume that they are more qualified. The researchers had 230 inexperienced negotiators and 223 real estate agents reviewing a sample of real estate to draw their conclusions. The floor plan pictures and other home details were all the same but the price of the listing was different. The listing prices started at two precise digits (e.g. EUR 980000) and slowly became more accurate until they reached eight precise digits (e.g. EUR 978781.63). They were then told to make a counteroffer and also to name the house’s maximum price they will pay. The more successful a bid novice individuals saw the more their counteroffer and overall price increased. Also, real estate agents raised their counteroffers as the initial price became more precise but only about five exact digits. At that point, real estate experts were actually beginning to diminish their counteroffers. The lesson for home buyers

Signing a mortgage agreement iStock.com The German researchers aren’t the only ones who have found that avoiding round numbers in a negotiation that give you an advantage. When a separate group of experts evaluated actual cash offers made in a publicly traded company for the majority of the shares they found round number deals ($20 vs. $19.80 a share) were less likely to succeed. Matti Keloharju wrote in the Harvard Business Review: “[ T]the accuracy of the initial offer seems to indicate how confident the bidder is of the value of the target company’s shares, ‘ but the company will interpret the round offer as an indication that the bidder has calculated the value of the shares inaccurately.” Although the analysis specifically focused on company share prices, the same principle is likely to apply to other circumstances like negotiating a wage and buying a noted Keloharju home. Home Ownership: The One Obstacle Most Home Buyers Face 10 Cities Where You Can Buy a Home $50,000

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