Our real estate company, Keller Williams, has something called the KW Belief System.  It’s ten points that guide agents through the sometimes challenging world of real estate deals.  It was nine points, but in 2020, we added a new one in response to the growing recognition that it is not enough to refrain from exclusive and discriminatory practices.  The addition of “Equity:  Opportunities for All” is based on a mindset that we must all be engaged and active in the fight against exclusivity and discrimination.

The full belief system is laid out below.  All our important but today we wanted to focus on the first of the beliefs, Win-Win or No Deal.

Here is why approaching real estate deals from this perspective isn’t just a nice thing to do, it’s an extremely smart and effective way of making the best possible deal happen.

Let’s go.

What is it?

The first belief above is Win-Win or No Deal, which means we strive for a transaction where both parties consider the deal a good one and come out of it feeling pleased with the result.

It sounds great on paper but it also sounds like you might be giving up something on your side (whether you’re the buyer or seller) in order to make them happy as well.

Here’s three reasons why Win-Win or no deal actually results in the best possible deal for you.

It opens the door to better negotiations.

Without a certain level of trust and respect, negotiations can’t actually go anywhere.  If one side is convinced the other side is trying to take advantage or beat them down, negotiations quickly fall apart.

A good analogy would be when you play a game and you do so with a healthy level of competition and sportsmanship.  We aren’t going to cheat in order to win, but we are absolutely going to play at our highest, best level.  When we establish ourselves as reasonable, competent people with the agent and person on the other side of a transaction, we open the door to negotiating an amazing deal.

In negotiations, it is often overlooked that all parties don’t value all aspects the same.  If we don’t seek to understand what is important to the other side, we can miss opportunities to give them something they value in exchange for something we value.  We have seen many real estate transactions where factors like closing date, inclusions and rental contracts have different value to each side.

For example, when an earlier closing date saves a buyer tens of thousands of dollars in interest costs on their mortgage rate and costs a seller much less than that in temporary storage costs, there is an opportunity to come to an agreement that both parties find beneficial.

When we have a professional, cordial relationship with the other side, we can use our negotiating skill and experience to convince them to accept the deal we want by understanding the deal they want.  We frame it so they understand, we use logic to make them think and emotion to make them act.  We get the deal done.

Sometimes, you walk away rather than accept a Win-Lose deal.

The flip side of the coin is that when we are unable to establish a relationship and goal of a Win-Win deal with the other side, we sometimes have to walk away.

When we encounter agents or clients on the other side who interpret Win-Win as “I win, and also, I win.” then we need to be prepared to move on.

Understanding the benefit of a Win-Win situation means accepting the fact that not all agents and people approach deals that way.  When we see that there is no genuine intent to work together for a good deal, we are clear about that needing to change or no deal can take place.

Due to the fact that some real estate companies train their agents to aggressively and pointlessly resist what the other side wants, you can find yourself in a negotiation that is really not a negotiation.  Take it or leave it is a binary option that can come with unacceptable trade-offs.

Sometimes, the other side comes around when they realize they can’t take advantage of us and push us into a bad deal.  In other cases, they continue to try to get what they want at the expense of what we want and we make the decision to move on to another option.

If you beat someone, you better not need their good will later.

Finally, we come to the most often overlooked aspect of negotiating.

When a real estate deal is agreed upon, buyers don’t give the sellers a bag of money and receive the keys immediately.  It is often months later that the deal actually closes.

During this time, buyers and sellers continue to have interactions in the form of purchaser visits to the home, appraisals from lenders, insurance forms, utility transfers, items being left behind and many other questions and answers.

Ask any real estate lawyer and they will tell you that some real estate deals go sour and fail to close.  There are, of course, consequences, in the form of lawsuits, penalties and wasted time and money.

The harder we negotiate, the less likely it is that the other side will be helpful if we need a favour.  When a seller refuses to concede a negotiating point that costs them little but greatly impacts a buyer, it creates ill will and resentment.

Such feelings give rise to decisions, some big and some small, that can either derail a deal or make it a worse experience for the other side.  A seller can choose to do the bare minimum required by law in order to clean and empty the home.  A buyer can refuse to accommodate a last minute request to extend by a day due to a family emergency on the seller’s side.

By following the belief of Win-Win or No Deal, we avoid circumstances later on that can make the deal problematic or even result in the transaction not closing.

Win-Win or No Deal is not simply a nice way to behave, it’s a model that allows for fierce negotiations based on a reasonable level of trust.  It gives us the ability to recognize situations that we cannot and should not accept and move on to other options.  Finally, it means that the deal we negotiate actually closes and that there are no unpleasant or expensive surprises along the way.

If someone you like has had a bad experience in the real estate world, we’d ask you to pass on this article.  Whether it’s buying or selling, we believe that everyone deserve to work with agents who understand the reality of the industry but also see a way forward that is better for everyone involved.  If that sounds like a Win-Win to you, get in touch.

It is often easy for parties to a real estate transaction to take on adversarial positions.  While the desired results for a real estate transaction can appear different in terms of specific metrics (such as what one party wants as a sale price versus what the other party wants as a purchase price), it is important to remember that the end goal is the same – to successfully conduct a real estate transaction.

We have done hundreds of successful real estate transactions and one key reason for our success for our clients is because we work with the other side, rather than against them.  This doesn’t mean we leave money on the table or are taken advantage of by a pushy agent on the other side.  Instead, it means we approach the other side with the view that they are interested in getting a deal done, with specific goals for how that deal would look.  By being friendly, curious and professional, we establish trust in the other side that often pays significant dividends in the form of more open communication and willingness to work towards a win-win deal.

Here’s a couple of examples where being nice paid off for our clients.

Time to Think and Decide

We had booked a showing for clients in an area outside of Toronto and we’d sent an introductory email to the listing agent asking for a few additional pieces of information that would be useful to our decision making process.

The agent replied quickly and said how nice it was to get an email like that prior to a showing.  He shared some useful information, told us a bit more about the seller and wished us a successful showing.

We arrived at the home and our clients quite liked it and we were sitting outside in the sun discussing whether we should submit an offer, when an automated email arrived from the listing brokerage saying that an offer had just been registered on the home.

Our client was a bit deflated to hear that, as they didn’t like the idea of competing in a multiple offer situation and we promised to speak to the agent and get more details.

After the visit, we called the listing agent, who immediately knew who we were because of our email.  He was forthcoming about the situation, admitted he didn’t know much about the agent or the buyer as they hadn’t been in touch beyond the offer.  We let him know that we weren’t interested in competing but that we had been discussing an offer and would be interested if this offer failed to get traction.  He agreed that it made lots of sense and he would be in touch.  We wished him luck and said it was a clear sign it was a quality home if he had an offer so soon.

The next morning, he emailed us to let us know the deal wasn’t going to come to fruition due to price and as of 11:59 AM, they would be open to a new offer.  He shared a home inspection and some other information about what was important to his client and said how happy he’d be to do a deal with us given how professional and pleasant we’d been in our interactions.

We shared that information with our client, they took the time to consider next steps, and based on the home inspection and a few other considerations, decided that the home wasn’t for them.

By reaching out to the agent beforehand, being pleasant and polite throughout, acting as a colleague rather than an adversary, we put our clients in a position where they were able to consider an offer without pressure, where they could have submitted without competition to a seller that had just seen a deal die, with an agent who trusted us as professionals.

Friendly but Firm Gets a Deal Done

After finding a home in Toronto that a different set of clients absolutely loved, we prepared for the offer date by getting a bank draft and being in touch with the listing agent.

We had previously met him at the home, as in addition to being the listing agent, he and his wife owned the home.  We’d complimented him on the home, chatted about the neighbourhood and he’d shared some information that my clients found useful in making their decision to bid.

On a second visit prior to the offer night, the lockbox code had been changed and the new one had not been provided.  We had to wait a bit, but we were pleasant as they tried to resolve the issue and friendly when they finally got it sorted.  We were understanding about this sort of thing happened and accepted their apologies without making it a bigger deal.

On offer night, we were in competition against five other offers and the intent was to have the deals reviewed and a decision made by 9 PM.  When we’d submitted the offer, we had included detail on our clients, expressed our appreciation for his work on the home and how we would look forward to getting a deal done.  We’d also including a photo of the healthy bank draft we had prepared for his listing brokerage as a deposit.

At 7:30, the listing agent called us to let us know that they were going back to the bidders to see if anyone wanted to make a change to their offer as several were quite close.  We made a revision up, but our buyers decided that was their limit, which we agreed was reasonable.

At 8:30, the listing agent called again, asking about a further price increase.  We agreed it was a lovely home, and we’d love to buy it, but we’d reached our limit.  He asked about a change to the closing date, which I said we’d be happy to accommodate, but it didn’t seem relevant given we weren’t moving on the price.

At 9:30, we gave him a call and he apologized, telling us he was sorry, that his wife wanted a significantly higher price and that he was still negotiating with another agent but would prefer to deal with us if we could come to the goal price.  We commiserated about it being a lengthy process and how owning and selling the home made it even more complicated, but said unfortunately we can’t go higher.  We wished him well and called our client to say while it wasn’t settled, it seemed likely they were going with another offer.

At 10:30, the agent called us and asked if we could resubmit our offer with a different closing date.  It was actually a closing date that was better for our clients and we said we could certainly do so, but did it matter if the price was not sufficient.  He shared that the other offer hadn’t provided a bank draft, he wasn’t that comfortable with how they were conducting themselves and he did feel more confident with us and our clients.  We called our clients, explained that it may simply be a pressure tactic on the other side, but we had nothing to lose if we resubmitted with this different closing date.  Worst case scenario, we still didn’t win the deal.  They agreed, we signed digitally and I resubmitted.

At 11:05, we were about ready to call it a night when an email arrived.  As we opened it, we had a call from the listing agent saying congratulations, we’ve accepted your firm offer.  Our clients were thrilled and couldn’t believe that after all of that, they had got the home they wanted at the price they wanted.

By being positive, friendly but firm throughout, we beat out other multiple offers, including what we were told was a higher offer.  We came prepared, we didn’t waver on our price, we were nice about the situation, and we were successful.

We have literally dozens of stories where our friendly approach to the agents and people on the other side made transactions either possible or easier.  When we encounter super aggressive agents, they are often new agents who haven’t learned that bullying the other side is not the way to get a deal done.

By being nice, seeking to understand the other side’s position, and cheerfully pushing for our client’s goal, we get deals done.  If that sounds appealing and you’re looking to buy or sell real estate, get in touch!  We’ll be nice, we promise.