Interest-based negotiations are also called ‘win-win negotiations’, which we often hear too much about. However, most of us look at this kind of negotiations as something that pleases both of the parties in a number of aspects. Well, the meaning of interest-based negotiating is beyond its simple interpretation that most of us have in the minds. But, complexity of meanings doesn’t really mean that these negotiations don’t give a viable solution to the real estate buyers and sellers. In fact, an interest-based negotiation is an ideal way to close the deals on a happy note, but one should know different aspects about these negotiations in order to handle things appropriately.
When to go for interest-based negotiation?
The number of those instances is not less when it doesn’t make any sense for interest-based negotiating. For instance, if you are the owner of a property that you don’t want to keep and, thus, you want to sell it right away, it won’t be appropriate to spend a lot of time in interest-based negotiating. In this scenario, a win-lose deal is the ideal way to go. With that said, you just need to price your property appropriately and stick with the price.
Buying house from HUD is another scenario in which you don’t have any choice rather than agreeing with the terms of the seller. In this kind of purchase, you can place your bid and move on. HUD will decide based on the highest bid.
As a general rule, interest-based negotiating is appropriate option only when it is the bigger deal.
In order to make the better analysis, you need to identify the stakeholder from other party and know about their interests. There could be more than one stakeholder you are about to deal with. A simple chart about your interests and that of the other party is as under.
In this chart, you can see that there are some conflicting interests on both sides. To elaborate it further, you can use a bit of coloring to make common, conflicting and different but not conflicting interests distinguishable.
Keeping the above chart in view, you can further analyze about the interests that you and the seller cannot give up, and also about the interests that are important but not that crucial. It will help you to make the deal more flexible while sticking to the grounds regarding the matters which are crucial. The crucial aspects can be made bold and underlined.
According to the chart above, the seller is unwilling to give up the seller financing, but he/she may do it if you offer the higher price. In this scenario, the seller is mainly willing to sell the property quickly and to the strong buyer, something that you are already offering. You may be willing to buy the property at lower rates, but good seller financing makes it easy for you to pay a bit higher without taking a hit on finances.