Epic Real Estate Investing - Trump's 9 Rules for Negotiating Real Estate Deals Like a Boss | Episode 196

Episode Date: February 29, 2016

Solid negotiation skills are one of the most essential proficiencies of a good real estate investor.  If you want to do deals (especially using none of your own money or credit), you’ll need to develop a good negotiating disposition.  On today’s episode, Matt is sharing 9 tips from Ivanka Trump on learning to negotiate like a boss.  Enjoy! ------- The free course is new and improved!  To access to the two fastest and easiest strategies to a paycheck in real estate, go to FreeRealEstateInvestingCourse.com or text “FreeCourse” to 55678. What interests you most? E.ducation P.roperties I.ncome C.oaching Learn more about your ad choices. Visit megaphone.fm/adchoices

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For the secret your financial planner doesn't want you to know, go to cashflow savvy.com. That's cashflow savvy.com. This is Terrio Media. Casting from Terrio Studios in Glendale, California, it's time for Epic Real Estate Investing with Matt Terrio. Welcome. Welcome to Epic Real Estate Investing, the place where I show people how to escape the rat race using real estate. You just got to shift your focus from making piles of money to making streams of money. Change that one thing, just one time.

And you are on your way to financial freedom. It's not the most exciting path. No, it is not. I'm not going to tell you that because it's rather boring. But it is the fastest. And once you get there, life then becomes exciting. And speaking of exciting lives, you know, when I tell people that I've built my real estate portfolio with, you know, very little of my own money and I've yet to use a bank. I mean, the typical response is, you know, it's a real head scratcher.

It's like, how did you do that? And in the second place, the second place response is, yeah, right. They just don't believe it. And I get it. You know, buying and selling real estate with little to no money for someone that has never done it is, that's a big mystery. And it's one that, you know, exists in the land of the unicorns for most. It's not as difficult as it sounds, though. You know, for so many of you who have been listening for a while, no. And certainly the Epic Pro Academy members, no, they get it. It's actually pretty simple and easy. As long as you have three things in place.

The first and foremost, it's probably the most important, is that you have a seller with some motivation. You've got to have seller motivation there. You've got to have a seller that has some sort of issue going on, whether their personal situation is distressed, their financial situation is distressed, or something about the property is distressed. stressed because the foundation of every deal lies in the seller's motivation to sell.

So you have to have seller motivation in place. The second thing you need is the knowledge of deal structuring, understanding the relationship between price and terms and how to manipulate the price and the terms in a way that the seller gets what they want so that you can get what you want. So you got to have that. And the third thing is you need a good negotiating. disposition. Someone might say negotiating strategy or, you know, a negotiating angle. I think it really comes down to just a good negotiating disposition, meaning, you know, if you're just honest and straight

with people and even transparent, I mean, you could really play this game with all of your cards face up, but if you have a good disposition about it, you can always win. And I don't consider myself to be a master negotiator. I mean, I'm good enough, but, but this is an area of where whenever the subject comes up, you know, my ears perk up because I'm always striving to be better. And in this past week, Coach Lisa, she shared an article inside of the private Epic Pro Academy Facebook page titled Trump's Nine Rules for How to Negotiate and Win. This is not Donald's rules, by the way, but his daughter, Ivanka's rules for negotiating. And so I clicked and read and I felt that it would be worthy to share with you,

as it will help you in your real estate investing business. No doubt. A lot of the stuff in these tips, we've talked about it here frequently, but just from different perspectives. So some of the stuff will be reviewed. Some of it will be brand new. Some will be like, boom, I'm going to use that,

like was the missing piece of the puzzle for me. Ivanka Trump, if you don't know, she's the executive vice president of development and acquisitions for the Trump organization. And she's had a lot of practice, negotiating with two of her biggest successes being the redevelopment of the old post office pavilion on Pennsylvania Avenue in Washington, D.C., and the acquisition of the iconic 800-acre Doral Resort and Spa from, and she actually did that from her hospital bed just after giving

birth to her daughter, Arabella. She's done big things, right? And she's, I think she's a good person to learn from. So I was really interested to hear what she had to say. So I'm just going to go ahead and and share what she had to say. Meticulous preparation and even temperament and a genuine love of the game are all factors she attributes to her success in negotiating development and acquisitions. So preparation and temperament. That's another word for disposition. So I 100% agree.

I think the temperament is really key. And she doesn't have strategy here or technique. She has preparation and temperament and then just a genuine love for what you do. And that she thinks that's what really contributes to her. her success as a good negotiator. As we all continue to work on our negotiating skills, she has these tips, several tips, nine specifically, that she considers crucial to stealing the deal and graciously getting what you want.

All right. So number one, set your goals in advance. Know what you want to achieve prior to starting to negotiate. You got to begin with the end in mind. You got to know your outcome. It's the golden rule, but the one that most people fail to heed. Without a plan, you allow the opposing party to define your. goals instead of the other way around.

So set your goals in advance. Number two, think long term. You know, when forming your goals, consider that negotiations are the beginning or the continuation of a long-term relationship. And there's nothing worse than being in a relationship with someone who feels like they've just been screwed. You know, oftentimes that the best negotiations result in a deal that benefits both parties. There are times when you simply want to go for the jugular, however, but often, you

You want the other person to feel pleased with the outcome, even if you are the clear Victor, which brings her to her next tip. Number three, try to understand the other person's objectives. You know, the most valuable thing you can do is correctly identify the other person's top priorities. Often the, they are not at odds with yours. And I totally agree with this. People ask me all the time, like, why would anyone sell your property at a deep discount when they can go on the open market and get top dollar?

Well, that would be most of the time when our objective is the same. But when you're talking to a motivated seller, your objective is not the same. And that's what she's saying here. Often the top priorities for each side of that negotiation, they are not at odds with yours, right? So they don't conflict. So you can give them what they want so that they feel like they've won all at very little cost to yourself and you get what you want. So yes, negotiating is about money and the bottom line.

but a lot of times it's much more emotional and complex than that. You're realizing that the economic outcome may not be the other party's top priority gives you more chips to play with and will enable you to achieve better results than you may have anticipated. Number four, over-prepare. The more you know, the stronger your position. Are you asking for arrays, do your research, and know your market value? Having an informed sense of your worth as dictated by the broader marketplace

will give you greater confidence in requesting increased compensation. It's tough to dispute someone who can back up their assertions with facts and a smart, articulate argument. Now, she's talking about your own personal market value. The example she's giving here is if you were to ask your boss for a raise. But the same here would apply to you if you were just to swap out, you know, your personal market value to your boss and then just insert the property market's value. Because if you do your research and you know your market, you know exactly the value of that

property and how that value of that property is dictated by the marketplace. You're going to have a greater confidence going in. And it's really tough for the seller to dispute you when you can back up what you're saying with the facts and a smart articulate argument, a smart articulate position. Got it? Number five, don't negotiate via email. It's a cop out that benefits the weaker party by allowing them to avoid a direct confrontation and take more time to craft a strong response.

It's also easy to misjudge. tone, which can be dangerous. She always prefers to speak face to face, typically in her own office, where she's most comfortable. If you can get a seller to your office, I absolutely concur. I think that is where you're strongest is when you're on your own territory, your own ground. However, we're in a business, right, where we will all eventually have to visit the property

and that being the seller on their own turf, their own ground. So it's not a deal breaker if you can't negotiate on your own territory and your own environment. but definitely opt for face-to-face over email. Negotiating over email is really a terrible, terrible idea. Number six, listen more than you speak. Talked about that before several times. You've got two ears, one mouth, use them proportionately. When people are uncomfortable and many people are when they have to negotiate, they start rambling as a way to fill the vacuum of silence. Some of the strongest negotiators she knows, just sit back and listen. The less they engage,

the more likely the other person is to slip up and offer information they otherwise would have kept guarded, would have kept a secret. And this is so true for us and what we do. I mean, I don't know how many times I've sat with sellers and just let them pour out all the beans. They just spilled all the beans right out there on the floor before I really even got started. So listen more than you speak. Seven, pay attention to the messages you're sending with your body language. It has been said that only 7% of communication is verbal.

of the message is conveyed through nonverbal cues, including facial expressions, gestures, posture, audible elements like size. Consider this as you think about how you present yourself. Don't fidget. Don't pick your nails or tap your foot. And think about do you look over-eager because you're literally on the edge of your seat? Are you hunched over and drumming your nails, communicating aggression or frustration? Or do you appear meek and intimidated with your arms crossed protectively?

The way in which you carry yourself, even when seated at a desk, it all matters. So regardless of how fast your heart may be beating, sit upright, make eye contact, and focus on breathing evenly. And I agree 100% with this. Absolutely. But that's a lot to remember, right? That's a lot. Oh, where am I feet doing? Where are my hands?

Am I fidgeting? Am I breathing? How's my vocal tone? All that type of things to think about while you're trying to stay present and inside and engage of that negotiation. That's a lot to remember. So the best advice that I've ever been given regarding this, and you've heard me share this before on the show, and this is to just act as if whatever it is that you're negotiating, just act as if it's no big deal. It just act that it's no big deal.

You do this all the time, right? I could take it or leave it. It's no big deal. Keeping those thoughts in my heads seems to snap my body language and my speaking tone into shape, rather than having to think about every single body part and what it's doing during the negotiation. just it's no big deal. I could take it or leave it. I do this every day. That's the type of disposition that I carry

and it seems to snap everything else physically into shape. Number eight, be mentally prepared to walk away. Be it a job offer or a rent renewal, you may at some point need to let it be known that you're willing to walk if you can't get on the same page regarding terms. If things get too heated, you can always take a break.

Say, we're obviously not on the the same page, let's take a day or two to think about things and then reconnect. Negotiations can get back on track pretty quickly when you allow people the time to cool off. If you do decide to walk away, it doesn't have to mean that the deal is dead. If you decide later that you want it badly enough, you can still go back and accept the deal on the other person's terms, even if you have to swallow your pride a bit in order to do so. So yeah, I mean, definitely the moment you're afraid to walk away is the moment you've lost. or the moment you're not going to do as well in the negotiation as you could have.

So always be prepared to walk away. And that can be really difficult, especially when the stakes are high, especially when there's a big paycheck at the end of this for you. But you know how you solve that? You know how you make it easier and easier for yourself to walk away and authentically like you really are okay walking away is keeping your lead generation consistent? Because if you're dealing with one lead,

that that lead is going to make your whole year, then you're not going to walk away. You're going to be afraid to walk away. And that lead will probably not end up making your whole year because you didn't negotiate it from as powerful of a position as you could have. If you had more leads backed up, if you had more deals in the pipeline,

if you knew you already had three deals closing this week. You got three more closing next week. And this one deal, it's not going to make or break you. If you can't get what you want, hey, you walk away and you move on to the next lead. Okay? That's what really makes the, it much easier to walk away and have that be authentic.

And when you have that disposition and when you really feel it authentically, you can go really deep and far, farther than you ever thought you could inside of negotiations. Okay. So deal flow, lead generation, do a lot of that. And they might not feel connected at the moment, but if you know you have a lot of leads coming into your business and you know you got deals closing,

it's very easy to walk away. And it's very easy to act as if, hey, no big deal. I do this every day. And that disposition right there, right there, that's going to make you a master negotiator, even if you don't have the strategy and technique to back it up, okay? Number nine, practice when the stakes are low. Practice negotiating and hone your style and skills with low consequence transactions. Call the phone company and threaten to switch providers if they don't give you a better deal

on your service going forward. Go to a boutique and ask for a discount. Sales associates usually have the latitude to discount an item up to 10% without a manager's approval. When the stakes are low, it's a great. time to work on your skills. Plus, it can be fun. Indeed. You know, one of the things I used to do to practice is when I would check into a hotel, and I've

shared this with you on the show before, it's been a while. But while checking in, when you're checking into a hotel, I would just lean over the counter a bit. I would kind of look to the right, look to the left, and then look to the person on the other side, the hotel clerk, and just kind of lower my tone of voice. I get a little bit soft and say, hey, this is a really special night. tonight, is there anything special that you can do for me? And then I'd just be quiet.

That tension right there, that silence, that silence, that's really remarkable on what you can get. I've gotten upgrades to sweets. I've gotten champagne delivered to the room. I've gotten champagne and strawberries delivered to the room. I've got corner units with a view. I've gotten all kinds of stuff. Now, it doesn't work every time, but it works a lot.

It works a lot. There's one place, another place you can practice and negotiate. I mean, you can call the phone company if you, want like she suggests or go to a boutique and ask for a discount. But boy, getting the perks and the upgrades at a hotel, that is fun. Now you know, right? You know. And you know that old Chinese saying, that old Chinese proverb, to know and not do is to not know.

So do. And negotiate everything because everything is negotiable. That's it for today. See you next week. I'm Matt Terrio, living the dream. You've been listening to Epiore. Real Estate Investing, the world's foremost authority on separating the facts from the BS in real estate investing education. If you enjoyed this show, please take a minute to visit iTunes

and share your thoughts. Thanks for listening. We'll see you next time here at Epic Real Estate Investing with Matt Terrio. This podcast is a part of the C-Suite Radio Network. For more top business podcasts, visit c-sweetradio.com. Thank you.