In Real Estate there are always 2 buyers in every transaction.
For many years in the real estate business I had never heard of this concept of 2 buyers for every transaction. In most cases the seller does not realize that as soon as he receives an offer,at that point, he also becomes a buyer. When he rejects an offer he is saying ” I am willing to buy the property for that price or even more”. I believe that if every party that is involved in the process of buying and or selling a property would understand this concept more deals would be completed to everyone’s satisfaction. When representing a potential commercial buyer/investor I learned to always spend time evaluating the property to help in establishing the potential value for that client. Always trying to find out just what their objectives are and how the property might meet those objectives. Things like- What kind of return would they like – How much cash do they have – Are they looking to hold the property for a long time or do they want to flip it. This will help to determine a price that they are willing to pay. This process will sometimes help to make an offer that can be justified in the buyers mind and reduce the number of offers and counter offers. It has been my experience that the more counter offer the more frustration for everyone and the less chance of a successful transaction and a win-win for all.
What most sellers/owners fail to understand is that they are in fact the second buyer. We as agents sometimes fail to explain this to them. It is important to list property at as close to market value as we can in order to help the seller/owner achieve their goal of getting the property sold. Ever seller that I have ever worked with would like to get as much for their property as they can. That is only human nature. But it is our job to ask the hard question – How much would you be willing to pay for this property. This conversation needs to happen during the listing process. In most cases this will produce a more realistic listing price and one that will be easier to defend. If a seller understands this concept before an offer has been presented it will speed up the process. If both parties understand this it will reduce the number of counter offers and increase the chance of arriving at a win-win for everyone. It is only right to say that in some cases the needs of both parties will not meet. Generally this will happen earlier in the process and allow all parties to move on to other opportunities.
Whether you are dealing with commercial or residential property this is a technique that will work and provide you with more sales. It will also give you the satisfaction of knowing that you have given your client the best possible representation. Try it. Even if you only get one additional sale this year it will be worth the time and effort.