Use This Buyer Scorecard to WIN Negotiations
The Cape House Show: Episode 60
Alright, picture this: you get an offer on your house, it’s pretty good. You’re ready to get in it, you’re ready to start negotiating. You get the price, you get the terms, and you don’t really have anything else. You’d really don’t know who these people are, you don’t know how hard you can push them in negotiations. What do you do? Well, if you’re working with us this is what you will do: we will give you what we call an Earnesty Score for each buyer that comes in and wants to buy your house. What does that mean? Well, it’s a scale from 1 to 5 that gives you some indication of how invested, how emotionally invested this buyer is in this deal and that will help you decide sort of where to go when you’re doing your negotiations.
Alright, at the bottom of the list in terms of like, heart investment on a property, would be an actual investor. Investors are out there, they’re really just talking about money. They’re making business deals and they’re not looking to pay a lot of money for the property that they’re buying relatively speaking. They’re looking to get a deal and that’s it. It’s not personal. They’re not trying to insult you. They’re not looking for a fight. If you don’t want to sell it to them for that, that’s fine. They’ll move on. The good thing about investors is you can really kind of push them as hard as you want. You’re not going to, like, irritate them or get in a fight with them. They’re just, they’ll just leave. So you can test them right off the bat, and be like “Yeah, no. I’m not selling it for that number, but if you buy it for this, I’ll sell it and they’ll give you, they’ll just give you a yes or no and they’ll leave. The good thing about that is if it doesn’t work out the first time – if you change your mind and later on you’re like “Ugh, you know what, I realized that I had it at too high a price. This is actually a good price that I want to sell it for.” You can go back, that bridge doesn’t generally burn unless they’ve moved on to another property (which they often do).
Alright, next up from there are second home owners. So these guys have a little bit of heart investment and sometimes a lot depending on their own personal situation, but still they’re dealing with discretionary income. So this isn’t a house that they need, this is a house that they want. So sometimes you can get a little bit tangled up in that need/want with them, but they’re going to walk away if it doesn’t work for them because there’s no pressure, there’s no time pressure. It’s like, “Meh. I’ll get it when I find the right one comes along, I’ll buy it.” So you can push those guys a little bit but there you may push them right away pretty quickly so you’ve got to understand that.
In the middle of everything with a 3 score are downsizers or retirees. So these people are looking for shelter. This is not a fully like “want to”. This isn’t a fully discretionary purchase, but by the same token, they still have a place to live. So they’re not going to be homeless if this deal doesn’t come together but they kind of, you know, there’s some urgency to get this job done so they might be willing to engage with you a little bit more, but just remember, because they have a little bit more emotion involved you’ve got to be sensitive to that and realize that you are on a fishing expedition, not a hunting, and we’ll talk about that a little bit more in a minute.
Up next on the Earnesty score with a score of 4 would be upsizers. These are people who are busting out of where they’re living. This is typically a family that is growing or anybody that is – maybe they’ve got mom moving in or they’re having babies – whatever it is, they can’t stand it much longer and they need to change houses. They need a bigger house. Now, high emotion, high emotion here, so you’ve got to understand that there’s pros and cons. They will do a lot to get the house that they want, they are likely to pay a little bit closer to asking or even over and they are probably going to endure a few more, a little bit more of a headache from you if they have to, but by the same token, they’re also going to really want those home inspections to come back clean and all that good stuff. So you’ve got to be conscious of that balance.
At the top of the Earnesty Score List would be first-time homebuyers. Alright, these people are looking for shelter. They have given their landlord notice. They need to get out. They need – they’ve got all plans that need to be put in place. They typically don’t have like an interim place to go, because if they did, why wouldn’t they go there now, you know? So these people are like fully invested. They’re ready to go. They are very – their heart is all in it. They are very likely to pay a very good price for this house, but they’re also very likely to get a little bit personally offended if negotiations don’t go well. So you’ve got to be respectful of where they’re coming from and when I talked earlier about the the hunting vs. fishing, you can’t club anybody over the head and make them buy your house. You’ve got to bait the hook with something that they choose to bite, and that is a very important thing to remember.
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Mother. Singer. Runner. Dog Parent. Realtor. Speaker. Cape Cod Local Expert. When I want the freshest oysters, I don’t go to the fish counter at the grocery store; I go to John, the East Dennis oyster guy. When my husband wants a perfectly tailored suit, we don’t go to the mall; we go to Puritan Clothing in Hyannis. When I want the best chocolate this side of the Alps I don’t go to the candy store, I go to The Hot Chocolate Sparrow in Orleans. A Cape Codder since I was a kid, I can find you the right house, bank, builder, school, auto mechanic, and yes, even the right oyster guy.