Property Option Expert Blog

The Crock of Gold at the end of the Rainbow is just a fairytale.

But the Rainbow itself is real. You must have seen one glowing brightly after a summer storm. Set against black clouds the effect is dramatic and stunning!

When air-borne droplets bend and reflect light from the sun after a downpour the message is clear and reassuring; storms tire and pass. We can learn much from a rainbow. Consider the process of negotiating an Option Agreement. This can be done clearly and in a way that gives reassurance. Since Options are more about people than property, offers made by phone often fail. A rainbow lives only in the mind of the beholder, so to enjoy its beauty you must be in the right place.

We established during our initial telephone conversation that the Seller is motivated to consider an offer and that the situation lends itself to an Option Agreement. For more information on how to do this visit www.PropertyOptionExpert.co.uk

We have developed trust (remember strong flour from the previous article?) which will help your offer to be accepted. More is involved, though. A rainbow glows only when light, water, air and the eye of an observer work together in a special way. For the Seller to sense that your offer is not too good to be true, but is a real solution, you need to negotiate skilfully. The Rainbow (Seven Step) System

We see seven distinct layers to a well-defined rainbow. There are seven stages to negotiating a well-defined Option Agreement. If you work through them one by one when you visit potential Sellers you will have great success. Let’s look at each stage in turn, starting with red

1. Rapport (Red)

Rapport is that ready connection between people who sense they have something in common. Rapport creates a warm feeling and a safe environment, ideal for talking openly.  When you visit the house, thank the seller for inviting you round.  If they are keen for you to view straight away, do so.  Ask tactfully about their family, work and hobbies. Pat the dog (unless it’s dangerous or flea infested). Notice photographs and ornaments, and comment.  Show genuine interest without prying.

2. Frame (Orange)

Ask the Seller where you can sit down to discuss things. Arrange a frame for your negotiation to ensure you get a decision before you leave. With rapport already in place, this follows naturally. Keep it light and upbeat, vibrant. Establish that you may offer a range of suggestions; a Yes or No in response is fine, but a Maybe is not. You want to reach an agreement today. Ask permission to tell them if what they need is beyond what you can offer.

3. Denial (Yellow)

Yellow is the colour of denial. For many sellers, especially when a sale is forced, being open is tough. It takes courage to face reality; to enjoy a rainbow one must look at the clouds. If denial is not worked through, any agreement will be short lived. Gently draw out the needs of the person. Engage with them on an emotional level. Be sure they describe the difficulties they face, not you, or there will be resistance.  Ask warmly – “What were you hoping I could do to help today?” Listen to hear and not to answer.

4. Go (Green)

Only when you understand where the person needs to be can you show them the green light. People sell to avoid pain or make a gain. It’s rarely about the money.  So, having discovered what is driving your Seller, point them in the best direction. The owner may have three choices:  letting, selling or waiting. Eliminate the alternative routes open to them, leaving the one you are signposting.  Do this by asking them how they would feel about renting out to tenants themselves or selling through an agent within 6 – 12 months.

5. Deadline (Blue)

Few things play on mind and mood more than a deadline and overcoming the blues can be a real challenge for someone pressured by time.  Ask “When would you like to have this problem gone, in 6 months… 12 months? In an ideal world how quickly would you like me to take this away?” The usual answer I get is “within a month”. Reassure the seller that if you are able to rent now and buy later you can do something today! Where there is no deadline, there is little motivation.

6.Financials (Indigo)

Dig in deep and review the financial situation. What is the asking price, the secured (and unsecured) debt, (you need to see some statements) and monthly payments? What is the lowest price they will accept? To contrast wanted price with lowest price ask; “What do you realistically expect to get for the house?”

7. Supposing (Violet)

This is where it all comes together.  Don’t vie

- let your ideas gently float, like droplets in air, and allow the light to play with them. Keep the Seller with you, moving one step at a time until you find the right angle and she sees the rainbow you’ve created.  So only make your offer when you agree that you have found a solution. That way no one gets offended and a “No” won’t kill the process.

Negotiation is an art which can create a powerful message, like a rainbow.  Negotiating for Option Agreements is rewarding.  Often the vendor is amazed at their simplicity and grateful for the reassurance. Against the dark backdrop of heavy clouds the effect can be stunning. The message is clear; storms tire and pass…and for those skilled at helping others… even the pot of gold is real!