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Negotiating Ethically is Not for Sissies
by John Patrick Dolan, CSP/CPAE
Negotiating isn't easy, no matter what your style.
Negotiating to get what you want takes brains and backbone,
regardless of whether you're gunning for your negotiating
counterparts, or focusing on designing equitable solutions.
You have to think through what you want and the most
effective way to get it. And you have to have the moxie to
follow through with your plans.
Sometimes just asking for something takes nerve. After all,
some of us were taught as children not to ask for anything;
instead, we were to wait until it was offered. That courtesy
may have won you points with your second-grade teacher, but
it'll kill you in the real world. We usually have to go
after what we want. And to get what we want, we have to be
shrewd negotiators, even when we try to maintain high
ethical standards.
As a matter of fact, negotiating on a mature, adult-to-adult
basis is even more demanding than slipping around and trying
to manipulate or trick the people you're negotiating with.
First of all, being open and honest takes guts. It takes
nerve basically to say to the people you're negotiating
with, "I want to play fair. How about you?" or "This is what
I want. How about you, and how can we both get what we
want?" You're challenging them to meet you on your level,
and you're asking them to focus on more than their
individual needs. You can get some strange reactions because
people aren't used to an open approach to negotiating. Some
people don't want to negotiate that way, which brings me to
a second reason ethical negotiations can be so challenging.
Making sure that you don't get manipulated by someone who is
not so honest takes savvy.
How to Avoid Being Manipulated
A difference in standards can cause serious problems when
negotiating. Just because you follow all the principles I
outline through Negotiate Like the Pros, that doesn't
guarantee that everyone you negotiate with will be as mature
and fair-minded as you are. (I know that once you've learned
all my negotiating secrets, you're going to be mature and
fair-minded, right?) You have to be prepared to run into
less-than-honest bargainers, people who have their eye on
the prize and have no qualms about running over you to get
it.
These people have no interests in forging mutually
beneficial agreements. They are only interested in what's
good for them, and they don't mind abusing others to get it.
They are the hardballers. They want to play rough. They
don't care if there's such a thing as principled
negotiating. They think they can get more by bullying the
people they negotiate with. They believe they're stronger
than their opponents and think they can walk away with the
spoils if they go for the jugular vein.
Don't misunderstand me. Not every person you meet at the
negotiating table is going to be an unscrupulous rogue. Some
people don't share your high standards for negotiating
because they don't know any better. Before reading this
book, what were your attitudes toward negotiating? Did you
see it as a "me-against-my-opponent" proposition? Did you
feel like the only way you could win was for someone else to
lose? Some people don't realize there's a better, easier way
to negotiate.
I have a system for negotiating that can handle any of the
problems that inevitably crop up when I'm with people from
either group.
Defense Tactic 1: Maintain your standards.
If a person approaches negotiations aggressively out of
ignorance, I can eventually win him or her over to my style.
Most people don't want to be enemies. They just don't want
to get ripped off. If you can demonstrate to them that
you're interested in a fair deal, they will usually drop the
aggressiveness routine and start to work with you.
Defense Tactic 2: Protect yourself by not fighting back
directly.
When you meet with the people who don't want to play fair,
you can protect yourself - and you don't have to resort to
trickery or manipulation to do it.
If you think about it, most sharks are propelled by three
basic drives - greed, self-centeredness, and an exaggerated
ego. And any of those three drives makes them extremely
vulnerable to a smart negotiator.
Roger Fisher and William Ury call this approach "negotiation
jujitsu" in their book Getting to Yes. Jujitsu is a form of
martial arts that focuses on deflecting attacks rather than
engaging the enemy. If someone is running toward you
aggressively, you don't stand your ground and hit back when
they run into you. You step to the side and let them run
past.
Defense Tactic 3. Call in a third-party arbitrator.
Rarely in my experience as a lawyer and a businessman have I
ever had to call in a third-party arbitrator because the
people I was negotiating with insisted on using
less-than-honorable techniques. It almost never reaches this
point. But probably most of us have been involved in
situations where we needed someone who was completely
impartial and had no links to anyone in the negotiations to
help guide the negotiating process.
The benefit of bringing in a third party is that they can
shift the negotiations from positional bargaining to
bargaining based on interests. A third party can look at all
sides objectively and weave together a plan that takes into
account everyone's interests.
Defense Tactic 4. Bail out.
When all else fails - you can't persuade the other party or
parties to negotiate honestly and openly, and a mediator
doesn't work - abandon the negotiations, at least for a
while.
Maybe a deal just wasn't meant to be. Sometimes you get a
gut feeling telling you to get out of a certain negotiating
situation. Go with it. Remember, you will be negotiating
from a much stronger position if you are willing to walk
away from the bargaining table. Maybe both parties need more
time to think about what they want and what they are willing
to give for it.
In Conclusion
Negotiating is a complex process, even under the best of
circumstances. Every person involved in a negotiation brings
to the event a different background, culture, perceptions,
values, and standards. Breaking through these differences
can seem impossible, yet it is crucial to creating a
mutually beneficial agreement. Maintain your standards
throughout negotiations.
If you can't win cooperation, chances are you will gain
nothing from the negotiations. When you encounter people who
aren't negotiating ethically, try to bring them up to your
level. If the other party doesn't respond to your attempts
to do so, be willing to walk away. You won't have lost
anything.
John Patrick Dolan, CSP/CPAE is a recognized expert in the
field of negotiation. He travels throughout the world
presenting lively keynote speeches and in-depth training
programs for business and legal professionals.
Is
Luxury Housing the Silver Lining in a Stormy Market?
The days of kicking over a rock in your office parking lot
and finding three buyers ready, willing, and able to write a
full price offer on your new listing may be a distant memory
but for many agents there is still a sliver lining to this
stormy market. What is it? Surprisingly it is the luxury
home market!
"We have reports of hot spots coming in from across the
country." says Scot Spading, a partner in the Luxury Home
Council - a group that provides the Accredited Luxury Home
Specialist designation to agents across the country. "The
fundamentals are still strong for affluent buyers. They have
a strong economy, strong GDP growth, low unemployment, and a
booming stock market."
A few hotspots highlights:
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· Phoenix, AZ
where according to sales data from the
Information Market in 2000 440 homes sold for $1
million dollars or more but amazingly through
the first 10 months of 2006 a mind blowing 2000
homes had sold in the same category (and 32
homes have sold for $5 million or more).
· In Manhattan the
average price per square foot is $1171 for a
condominium making the average purchase price
more than $1 million dollars while in the upper
10% of the New York market the average sales
price has also surged 18% in 2006 to $4.5
million dollars.
· California -
According to the First Republic Prestige Home
Index by First Republic Bank in Los Angles
luxury home prices are up 12.8% from a year ago
to a record $2.36 million, San Diego luxury home
values have also climbed 6.4% to a new record of
$2.14 million, and San Francisco has gained 4.8%
hitting a new milestone of $2.93 million
dollars. |
Luxury home
developers show no sign of throwing in the towel either,
Chris Peterson a developer in Ogden, Utah is working with
the city to buy the city's Mount Ogden Golf Course as well
as an adjacent parcel of land from Weber State University.
His plan? To build a subdivision featuring luxury homes
surrounding a redesigned golf course, and he isn't alone.
According to a recent interview in the Wall Street Journal
developer William Zeckendorf, who is building one of the
most highly anticipated buildings in New York City, states
"From my vantage point the super luxury market is as strong
as I've seen it."
Toll Brother the nations leading builder of luxury homes is
also pressing forward with several new projects including
six new communities in greater Denver. The next to arrive is
Castle Pines Village an exclusive, master planned community
located in southeast Denver, 30 minutes from downtown and 15
minutes from the Denver Tech Center with prices starting in
the upper $600,000s.
Interestingly the continued strength in Luxury Housing
doesn't end at the border. In London-Ontario, Canada luxury
downtown apartments and condo's are a favorite according to
Derek Anderson, president of the London Home Builders
Association. He points out the aging baby boomers are the
most likely buyers for these units. Baby boomers a 78
million strong demographic tour de force have become the
target market of choice for luxury home builders,
developers, and real estate agents. Wisely they have
discovered that almost one in four boomers or roughly 19
million of them have a high net worth of $500,000 or more
and this is expected to rise as the generation ages.
Virtually all of these high net worth households are home
owners and 47% own more than one home. According to a study
done by the National Association of REALTORS® boomers want
more than just four walls and a roof when buying a home they
also want amenities where they retire, including cultural
activities such as museums and art galleries.
The Iconic retirement Del Webb development company has seen
this trend first hand as well and few companies are better
at anticipating boomers' evolving housing needs more than
Pulte's Del Webb division, the nation's biggest builder of
retirement homes. In their newest active retirement
community just outside of Phoenix, where the biggest home
tops out at nearly 3000 square feet the focus is on so
called "soft amenities" like cooking classes, yoga and core
training sessions, and even "adventure programming" that
includes white-water rafting and skydiving.
"Boomers want to enjoy life, and they should. They've earned
it!" concludes Spalding of the Luxury Home Council.
Will the luxury home market be your silver lining in a
stormy market? For many agents the answer is yes! To
discover if luxury homes are a hotspot in your own market
you may want to explore the local MLS system by analyzing
how many homes have sold for at least twice the average sale
price and then compare these numbers with the historic
trends in your community.
Pending Home Sales Holding But Still Off From One Year
Earlier
Thursday, January 04, 2007 -
WASHINGTON, D.C. - A stabilization trend in the housing
market is likely to continue, according to the latest
reading on pending home sales published by the National
Association of Realtors®.
The Pending Home Sales Index, based on contracts signed in
November, eased by 0.5 percent to 107.0 from an upwardly
revised reading of 107.5 in October, and is 11.4 percent
lower than November 2005. The decline from year-ago levels
has been steadily narrowing since July, which was 16.0
percent lower than the same month in 2005.
David Lereah, NAR’s chief economist, said the narrowing from
year-ago levels is a significant factor. “Because there is
a stronger parallel between changes in the index from a year
ago and the actual pace of home sales in coming months, the
index is pointing toward fairly stable home sales in the
near future,” he said. “That is another indicator that home
sales likely bottomed-out in September.”
The index is derived from pending sales of existing homes.
A sale is listed as pending when the contract has been
signed and the transaction has not closed; pending sales
typically are finalized within one or two months of signing.
An index of 100 is equal to the average level of contract
activity during 2001, the first year to be examined and the
first of five consecutive record years for existing-home
sales. There is a closer relationship between annual
changes in the index and actual market performance than with
month-to-month comparisons.
“Although some monthly declines are possible, when we look
at the forecast for existing-home sales in 2007 on a
quarterly basis, we see gradual improvement over the course
of the year,” Lereah said. “That will support future price
appreciation as inventories are drawn down.”
Regionally, the PHSI in the Midwest rose 4.8 percent in
November to 101.7 but was 11.6 percent below a year ago.
The index in the South slipped 1.1 percent to 121.6 and was
8.9 percent below November 2005. The index in the West
declined 2.6 percent to 106.6 and was 15.9 percent lower
than a year earlier. In the Northeast, the index was down
2.8 percent in November to 85.5 and was 9.6 percent below
November 2005. |
