Wiggle Room


Wiggle Room

One of the keys to the car negotiation I just described is the fact that the price I give is actually my goal; it’s as non-negotiable as the shade of black on the model in question. I believe it’s easier to simply state the goal right out; there’s less time wasted. The other side in a car deal has done the same thing by presenting a specific set of options and models for sale. They’ve limited the universe, so why can’t I?

The one practical difficulty with this method is that many people are not going to take you at your word when you say up front that you’re making your final offer, at least not when money is involved. I don’t think that’s an argument against doing it; on the contrary. But you do have to indicate that you really, truly mean it.

Like I said, that’s the idea of the deadline. But I have to say, from experience, that you’ll be tested.

Not a problem, right? Because you can always take your out.

Some negotiators want a little wiggle room to work with, even in a very simple negotiation. They’ll make a money offer a little lower than their goal, knowing they’re likely to come up a bit to make the deal. Negotiation is an art, not a science; you do what you’re comfortable with, as long as it meets your goal. Remember, though, that giving yourself wiggle room involves tactics, NOT—repeat, NOT—your goal. Your goal always remains steadfast.



Complications

A negotiation to buy a car is a good real-life example not only because we all do it, but also because it parallels most situations where we buy something, be it for ourselves or a large corporation. There’s a fairly limited range of possibilities, both in terms of possible products and options, and in price. Up-front research and decision making presents the negotiator with a relatively easy task; once the negotiation gets under way, there will generally be only one or two sticking points—one, actually, and it’s almost always price. The negotiator can focus his strategy on clearing that last hurdle at the closing. While being realistic and ready to grab your out are often easier said than done, those really are the keys to a good negotiation, especially in a relatively straightforward situation like a car sale.

But what about situations in which there are a ton of hard to quantify variables? Where not only are you dealing with your emotions, but with the other side’s as well? And where you have a complicated relationship with your negotiating team—and so does the other side?

In real life, we call that buying a house.



Needs and Wants

For many of us, buying a house is going to be one of the biggest purchases we ever make. It’s also one of the most complicated. Not only is a lot of money involved, but there’s the whole question of where you want to live, who your neighbors will be, practical maintenance questions, ego things, emotional attachments—the decision to buy a house can be a real nightmare.

But that doesn’t mean the negotiation should be.

I happen to have been in this situation myself as I sat down to write this book. I started very simply, sitting down at the kitchen table with a sheet of paper. “Needs” went on one side, “Wants” on the other. I need three bedrooms, one for me and the wife, one for the child who still lives with us, another to be used occasionally by the other kids who visit. I want five—this way all the kids have their own rooms and we can have guests, I have a bed handy when the wife starts to snore, etc.

I went down the list, room by room, then moved to the outside. Finally I came up with a realistic figure on what I could afford to spend . . . and what I wanted to spend, which obviously was a little less.

I’m not writing a psychology book here, or even one on houses, so I’m not going to get off on a big long tirade about being realistic about money and houses and egos and that sort of thing. And let me tell you this right now: If, like my friend Jimmy, you want to buy an $875,000 house for $350,000, you’re going to need more than negotiating skills. I know it’s hard to be absolutely realistic, especially these days and especially about houses. The list you start with of needs and wants helps you do that, but obviously the list alone can’t keep your emotions in check. The more up-front work you do, the easier it may be . . . but real life is, admittedly, messy.

Once you know what you need and want, you’re ready—not to buy the house, not even to look at them, but to pick your negotiating team. Because in this sort of complicated scenario, you (and probably your spouse) are the commander(s). The real estate agent is going to do the real negotiating.

Real estate agents, even so-called “buyer agents,” are never really working for you. They’re working for their commissions. That’s fine; they need to pay their own mortgage and send their kids to school and do all that good stuff you’re trying to do too. You can work with them—you can work with anyone, really—as long as you keep that in mind. Their motivation is making their commission, which only happens if they make a deal.

Any deal.

Your motivation is different. Your goal is a certain kind of house at a certain price in a certain neighborhood. Different goal. Very important to remember.