Negotiation Techniques Flashcards

Anchoring in negotiation refers to:

Answer: Setting an initial reference point that influences how later offers are judged

The first number put on the table tends to shape the other party's view of what is reasonable.

Why might a seller's agent advise against countering a lowball offer with only a token $1,000 price reduction?

Answer: It can signal that the seller is unwilling to engage and may end the negotiation

A counter that is too rigid can drive off a buyer who might have been willing to come up a lot.

In a counteroffer, a seller accepts the buyer's price but changes the closing date. Legally, the buyer's original offer is:

Answer: Rejected and replaced by the counteroffer

Under contract law, a counteroffer rejects the original offer and becomes a new offer.

A seller wants to stay in the home for 45 days after closing. What term should the seller's agent negotiate?

Answer: A post-closing occupancy (rent-back) agreement

A rent-back or post-closing occupancy agreement lets the seller stay after the transfer under set terms.

A buyer submits an offer contingent on selling their current home. Which clause protects the seller's ability to keep marketing the property?

Answer: Kick-out (right of first refusal) clause

A kick-out clause lets the seller accept another offer if the first buyer won't remove the sale contingency within a set time.

Which concession pattern is generally most effective for a seller during price negotiations?

Answer: Shrinking concessions that signal the seller is nearing a limit

Smaller and smaller concessions tell the buyer the seller is close to the bottom line.

Offering a one-year home warranty instead of lowering the price is an example of:

Answer: Trading a non-price concession that may cost the seller less than its value to the buyer

Non-price concessions can satisfy buyer concerns at lower cost than an equal price cut.