Mediation in Transactions Getting to Yes

By
Real Estate Agent with John L Scott Market Center 700512026

While going through my continuing education course to keep up with Oregon's law for REALTOR®s every two years, I just finished several chapters on mediation. 

As REALTOR®s, we face this constantly, and each case is different. Here are some of my thoughts about how to come to "yes" as the book "Getting to Yes Negotiating Agreement without Giving In" by Roger Fisher and William Ury  tackles. 

 Fisher and Ury explain that a good agreement is one which is wise, efficient, and which improves the parties' relationship.

 

Mutual Gain Optionswin-win as some would say. Each party has their own needs/wants. No one need be the only winner, compromise is inevitable.

Their four principles are: 1) Separate the people from the issues and problem; 2) Focus on interests rather than positions; 3) Generate a variety of options before settling on an agreement; and 4) Insist that the agreement be based on objective criteria.

 

The person is not the problem, the problem is the problem. 

 

Being Intuitive: i.e., What is it that's NOT being said?  Body language, tone of voice, these are just two ways of paying attention to what is important to all parties. Listen with your gut, not just your head. What is it that the other party wants and may not be saying out loud? What triggers occurred that set them off in a direction of wanting more than what's on the table currently? Ask open-ended questions. 

 

 

See it from the other side.   This can be quite helpful in giving some insights as to what they really want, without your own agenda clouding it. Ask for reasoning behind other parties' suggestion(s), clearly see what motivates them. Who else is offering opinions that may muddy the waters??

"Leave your ego at the door" is one of my all-time favorite phrases

and can help in any relationship. 

 

Brainstorming/Getting Creative: Sit down together, as a team and throw out as many ideas as possible. Don't judge, just use your imagination. Think about the other party, and what if you were in their shoes,what they would want. Write them all down...make it stream-of-consciousness without curbing your enthusiasm or creativity. You never know what may stick! Throw it all out there with no judgement!

 

Having a Carrot: As a seller, there may be items or services that you would like to use as bargaining chips, or a "carrot" as I call it. Furniture, a home warranty, lawn equipment; these are just a few carrots that you can hold out until negotiations get a bit more dicey and then you have something else to add to the pot, instead of throwing it in at the very beginning. It might just tip the scales in your favor. 

 

Consulting an Outside Expert: Sometimes it takes paying for an outside expert to give an objective opinion about negotiating the cost of something that has become a stumbling block during a sale. For example, roof replacement. The home inspection shows that the roof is on its last legs. The loan company won't loan on it if the roof isn't replaced. Getting estimates, three is a good number, and looking at different types of roofing, comp vs metal for example, and comparing all of that, gives both the buyer and seller some clear numbers to work with based on an objective 3rd party. A roof can even be replaced and money held in escrow to pay for it at closing, if the seller can't come up with the money ahead of time, is a creative solution. 

This may also mean using a professional mediator. This has become much more popular a choice in the last 20 years vs going to court. Not only is it less costly in time and money, but far less litigious. A mediator can change people from positions to interests and remain objective and unbiased. 

 

Best and Final: When there is a lot of back and forth negotiating going on, it can get past the point of it just being about money, but can move into an emotional tug-of-war. Sometimes, to end that, a line needs to be drawn in the sand. "Best and final" means, this is the LAST that my client is willing to offer, and we are okay to walk away if this isn't accepted. BUT, your client has to be prepared to do just that, or else all credibility is gone. 

 

Present and then SHUT UP. Silence can be very effective. 

 

Sometimes it's good to walk away: Square Peg in the Round Hole Syndrome

Often, I can see when there is too much struggle going on, it's not the right fit. The good part about negotiating up to this point, is that you have gained some practice in how your client works in a stressful negotiation situation. At this point, you also can tell if you want to continue working with this client, or if this property is the right fit for you and them. Each transaction, even if it doesn't come to fruition can strengthen your knowledge base as well as showing your client what your skillset is. If it doesn't feel right to you, tell your client that! If you are really looking out for their best interests, then they will respect that. It shows that money is not the motivating factor for you, service and integrity are. Don't take it personally! Let it go and move on. I am a firm believer that when it's meant to happen, it WILL. 

 

 

Everybody wins!

 

This is my credo. It can involve compromise, nuance, some assuaging, mutual gain, respect. And ultimately each person feels that they got SOMETHING that they wanted. 

 

 

 

 

 

 

 

 

 

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Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

Hi Gayle

There is a ton of great advice in your post that works not only for a formal mediation but in negotiations. I think leaving your ego at the door is particularly valuable advice. Sometimes negotiations seem to be more about a battle of wills, and not just the buyers or sellers.

Jeff

Mar 20, 2018 08:16 AM #14
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Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Carla Freund it's sensible to hold back on some things. If my seller thinks about making a repair on something, (probably minor), I sometimes suggest waiting until a home inspection brings it up and then they've already decided they wanted to do the repair so this looks like a good faith move on the part of the seller by agreeing to do that. 

Brian England oh how you made me laugh!!!!!! Thank you for that. 

Sheila Anderson and that is one of those that I continue to work on!! 

Richie Alan Naggar that is a HUGE compliment. I often work with both sellers and buyers as a dual agent and 98% of the time, it works really well!! 

Jeff Dowler "leave your ego at the door" was something I learned when I was working in long term care for ten years. Many children of parents with dementia or Alzheimer's had to be reminded of that, because of the buttons that get pushed by relationships between parents and children. It has served me well in that capacity as it has in any relationship. 

 

 

Mar 20, 2018 08:40 AM #15
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Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

Aw, the art of negotiation. Good post and happy to see the gold star. Amazing when a class can turn into fodder for a blog and so on...congrats. 

Mar 20, 2018 11:25 AM #16
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Gayle negotiating is an art, and "Leave Your Ego At The Door" is excellent advice.

Mar 20, 2018 01:29 PM #17
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Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Debb Janes EcoBroker and Bernie Stea JD I love the online company I've used for years for my CE courses. They're interesting, thank goodness! I had to keep writing notes to myself in "draft" because it brought up so many thoughts for me to ponder. 

One of my favorites of all time,  George Souto! Another one that is completely different: Chance Favors the Prepared Mind. 

Mar 20, 2018 03:56 PM #18
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Liz and Bill Spear
RE/MAX Elite 513.520.5305 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

The perk of being an engineer/agent is I don't have any ego in the game.  My clients and your clients both want the same thing, the exchange of the home for a big pile of cash.  So how are we going to get them to the closing table?  What combination of dates and money and stuff will make it happen?

Mar 20, 2018 05:52 PM #19
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Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Love this post Gayle- And learning how to mediate a situation can help us in all aspects of our lives. 

Mar 20, 2018 06:20 PM #20
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

I think in our jobs, we are natural-born mediators (if we're good at what we do)! It's always good to be on the outside looking in and assessing the wants/needs on both sides, rather than making emotional decisions (as many buyers & sellers do, no matter how much we coach them not to). Without the emotion, we are able to understand both sides and hopefully propose a win-win resolution. I would love to take that course - kudos to you for going the extra mile, Gayle!

And, congratulations on the gold star too!

Mar 20, 2018 06:22 PM #21
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Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Liz and Bill Spear well, dear, you are the minority, sadly. Too many egos in this field and in everyday life. Letting go of "ego" is one of the most powerful and yet most difficult things to manage in daily life--and every aspect of it. Kudos to you! 

 Kathy Streib just recently this was a valuable lesson in dealing with my mother's serious surgery and all of the obstacles we tackled (as a family of three) afterwards. Talk about having to leave your ego at the door!!! WOW.  Many power struggles, tons of emotion, navigating new territory, learning new medical diagnoses (and I'm even familiar with some of it)....it all is/was quite humbling. My sister and I never got angry with each other, but brought our own strengths to the table and talk about mediating! We did a ton of that with our mom. Big lessons happened. So, you're right, it's not just real estate that this applies to. Marriage, family crises....all kinds of stuff! 

Debe Maxwell, CRS if WE can take the money aspect out of it, lay it aside and be objective then that can give our clients a solid bit of ground to walk on. Big money and big emotions can stir up the pot until it's boiling, if we don't turn the heat down and let it simmer until it's  perfectly cooked!! (I'll bet Martha Stewart would be all over this analogy!!!) This course was delightful and one of my favorites so far. You would have sailed through it, no doubt!! 

 

 

Mar 20, 2018 07:21 PM #22
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Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Congratulations to another well written post and it is nice when you get recognized for it Gayle. In my market there are huge price points and huge egos...the ones that are successful do not have them and deals just come together easier... now I never have a "Problem" in any of my  transactions instead I have "challenges that need to be over come" Endre

Mar 20, 2018 10:02 PM #23
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Amanda S. Davidson
Amanda Davidson Real Estate Group Brokered By eXp Realty - Alexandria, VA
Alexandria Virginia Homes For Sale

Gayle, I'm so glad to see this featured. You wrote a great post! It can be hard for buyers/sellers to put themselves in the other party's shoes but, I think that's where a great agent comes in. If we're calm and provide guidance things can be worked out. I've been meaning to do a video on agent behavior during negotiations and how it can derail a deal, you just inspired me to get on it! Have a wonderful day my friend.

Mar 21, 2018 05:35 AM #24
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Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Egos best left out and remembering the goal of the transaciion...on both 

sides of the table !

Mar 21, 2018 06:06 AM #25
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Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experienced Agent in Kansas City Metro area

Thanks for the tips!  I have used the carrot approach.  Try to make both parties happy and feel like they 'gave' up equally.

Mar 21, 2018 07:47 AM #26
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Jeffrey DiMuria 321.223.6253 Waves Realty
Waves Realty - Melbourne, FL
Florida Space Coast Homes

Mediation can be so stressful for people because they often come in expecting the worst possible outcome.

Mar 21, 2018 08:00 AM #27
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Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Endre Barath, Jr. I would imagine that your clients love you for the ease...the professionalism, but without the "it's- all-about-me" mentality. 

You're right Amanda S. Davidson and they look to us as a guidepost. Sometimes, they like to take their power into their own hands and be controlling, but that, once again, is ego-driven. I think that for the most part, we draw the kind of client we WANT, who are somewhat like-minded in work and in spirit. I have walked from some who just weren't "right". After you've been at it awhile, you have the freedom to do that.

"The goal of the transaction", yes Sally K. & David L. Hanson ! 

And mentioning saving that carrot right before listing is always a good way to brooch the subject in my opinion, planting those seeds early on, Mary Hutchison, SRES, ABR .

Jeffrey DiMuria 321.223.6253 Waves Realty that's why mediation is so successful, because it eases the stress from the start...by having a conversation, and a feeling of "we're all in this together, as a team".  A professional mediator can create that welcoming dialogue right from the start if they're worth their salt. I've never had to come to that point, having to hire a professional. 

 

 

Mar 21, 2018 08:32 AM #28
Rainmaker
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Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello Gayle - such a smart post and so deserving of its gold star. Congrats.

Mar 21, 2018 07:57 PM #29
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Curtis Van Carter
Better Homes & Gardens Wine Country Group - Yountville, CA
Your Napa Valley Broker Extraordinaire

Gayle

One can read this and understand, mediation doesn't have to be a bad thing. Here in CA, I believe it solves approx. 80-90% of the cases that use it. cheers cvc

Mar 22, 2018 08:25 AM #30
Rainmaker
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Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

I've never seen this much information on mediation. Great content!  These are great ideas to form a compromise so that everyone wins.  

Mar 25, 2018 06:23 PM #31
Rainmaker
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John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Gayle, I would find it to be very difficult to select one of your points as the best point. They are all great and needed in Meditations.

One point stood out to me as it really reflects my view of business:

The person is not the problem, the problem is the problem. 

Thanks for sharing

Mar 26, 2018 08:56 AM #32
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495,133
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton & rest of Maryland

Dear Gayle,

Making something come out win-win for all seems like a good strategy.

Mar 28, 2018 08:25 PM #33
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