We Are Selling with Lee Woodward
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We Are Selling with Lee Woodward
The Understanding of Can't and Won't When Negotiating with Wayne Marriott
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This week’s podcast features Wayne Marriott, a specialist in negotiation with 31 years of experience in real estate. The discussion centres on the importance of negotiation in the real estate industry and the subtle nuances of language that can significantly impact the outcome of a deal.
The episode provides valuable insights into negotiation techniques and the psychological aspects of real estate transactions, focusing on the impact of language and the role of real estate agents in facilitating successful deals.
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Hello and welcome to the podcast We Are Selling. Brought to you by RealTech, the home of pitch, sign and sell. Over the last five weeks, we've had many requests from the marketplace regarding the negotiation process. An understanding negotiation takes a long period of time, and for many agents, not something they study, unlike listing, selling, and prospecting. And selling is a process, it's a transference of feelings. The words around a negotiation can very quickly change, both on behalf of the owner and the purchaser. And if they feel something's not right, something's not there, the whole deal may not come together. And we see this time and time again for both parties to walk away and not get the outcome they were after. And when we even use the word negotiation, it's a collaboration because if we can't pull both parties together, it simply won't stick. We don't have a deal, and that transaction has moved on. So today I was very fortunate. I was at the Complete Lead Up Conference last week, and the incredible Wayne Marriott was there, and we got onto this topic of negotiation. He's a specialist in this field. He joins me now. Wayne, welcome to the program. Hello, Lee. It's wonderful to be here. Now, Wayne, bit of background for you because you've been in real estate a while. Yep, thirty-one years now.
SPEAKER_01:I went into it as my second career and uh started without really having real estate experience and picked it up from there. It was very hard for the first 20 years, and the last 10 it's been delightful because it's all come together with a great team, great systems, and uh a lot of freedom of choice.
Lee Woodward:And Wayne, you've built an incredible business. Uh you're in New South Wales on the Lower North Shore area there. Over that time, not only sales, but property management's been a huge part of your business. Give us some background into that.
SPEAKER_01:Well, very quickly, the uh we were when we started, we did a lot of training and it really set us apart, um, particularly in the sales area, getting uh good listing presentation, uh prospecting, all the rest of it, was where those other agents just didn't train, didn't really improve their craft. Um, and we stood out in those early days. But what's happened to me in sales is over the time all my competitors have improved dramatically. There's they train, they're they're getting good people, the unfortunate characters have been weeded out uh through reviews and and just been caught out for for um for just not being up to it. And uh so I always gravitated towards property management because it's very good to be something that you could systemize. Um and even though the systems are incredibly well defined, everyone knows how often you visit properties, how you rent them out, and all the rest of it, I got amazed that most of my competitors don't do it. And so, Joey, by just doing the job with really good processes and systems and good people and good corporate structure, we ended up being very, very good at property management with a very discernible difference between us and our competitors. And that's just led to continual growth from no properties to a thousand properties through just incremental growth. And that's been a great joy to me.
Lee Woodward:Um and just for your area, so our listener can get an understanding, what is the type of property being rented and sold within your area, Wayne?
SPEAKER_01:Well, it's got uh a large number of units, high density. We're not in the absolute prestige parts of the lower north shore, like Neutral Bay, Moslem, Greenwich, Longeville, those sort of uh suburbs. Crow's nest was a working class suburb uh originally, and so it's got a lot of units, high density, not really many fantastic um homes. So it turns out over time we've been just very good at managing strata properties, and about well over 80% of the properties we we manage are strata.
Lee Woodward:Very good. Now, property management and sales both require negotiation. And Wayne, the tip you're going to share with us today is can't and won't. Take us into this.
SPEAKER_01:Yeah, negotiation is all about words and body language, and the choice of which word is used can have a profound effect on the result. And can't and won't is probably one of my favorite examples to demonstrate the slight difference in two words and the major difference in the effect. Um and it starts with the situation where there's there's only two reasons a buyer will have a highest price that they're prepared to pay for any property. And the first is they can't pay anymore for a particular property, and they won't pay anymore. And the difference may not be very apparent, but to me it's critical. I'll give you a scenario. You have a buyer who expresses that they very much like a property, and they, you know, they've spent some arji parge about offers and some lower ones, and finally they get to a million dollars, and they add the words, we can't pay any more than that. That's it.
Lee Woodward:And this is where the owner kicks in, Wayne, doesn't it, and thinks, well, find me someone else.
SPEAKER_01:Yeah, it's so that's what happens. You see, the buyer has made a mistake because the first thing they've done to me as the agent is they've said to me in in the words that I hear with they can't pay anymore, is they would pay more for the property if they had more. So therefore, I'm thinking, well, this means that the property is now in the market worth more than a million dollars, and that this person isn't our best buyer. So that's the you know, the buyer has made a mistake by doing that. Then the next thing that's up for grabs is what happens to the offer that we now have received and how do we present it to the owner? And if it's presented to the owner without any modification, the owner will, to some degree of consciousness, either a sort of dull feeling, it's all that mean, to the extreme end, which is when they'll say to the agent, um, okay, it's good that these people like my property, but why should I lower my price because they don't have enough money? Listen, I'm not a charity. And they might go on with, no, actually, what I'd like you to do, Mr. Agent, is find some other buyers who like my property just as much as they do, but they have more money. And while we're at it, um, I don't want you bringing any more poor people through my property. So, you know, not every owner will be as forthright as that, but you've taken the situation where you've got this offer from them, some nice couple who have expressed, you know, desire to buy this property to the point where the owner doesn't want to deal with them. And they're pretty unhappy with the agent.
Lee Woodward:And what's interesting about this Wayne is it happens all the time that the owner and the buyer hate each other, they've never met, and the only conjugate of information is the agent and the choice of their words. But there's so much in this particular tip because I can't pay anymore versus I won't pay anymore. If I'm the purchaser and I'm saying I won't pay anymore, what do you feel that sends a signal back to the owner?
SPEAKER_01:Well, again, um the buyer is now saying, and that and I recommend to if I'm discussing this with buyers and saying how to how to acquire the property that you want. I say to them, even if you can't pay anymore, never ever say that. You always say, I won't pay anymore. But buyers should actually clearly separate themselves being seen as poor people. They're better to say, look, I could pay more than a million dollars for this property, but only for a better property would I pay more than a million dollars. So I could pay it, yeah. So I've got the money, but I'm not prepared to pay any more than a million because this property isn't worth any more than a million dollars. And I'd probably add, look, in fact, I think I'm already paying too much, but I like the property and I feel I'm paying a premium right now. So that discuss that presentation of the price that from the buyer has now been fed through to the owner saying, Look, it's not that I can't pay anymore, but your property just isn't worth any more. I like your property, I haven't offended you, but I've looked around and listen to me, I know what I'm doing, and you're any more than a million dollars is too much for your property. Now the owner can't be offended with that, they're just getting some very good feedback from someone who knows what they're doing.
Lee Woodward:But what's powerful about this, Wayne, is you can see how our I can just see our listener pulling the car over right now, going, How many times have I said that? Yet the connotation of that to our vendor is well then find someone else because I want as much as I can. So the problem's not the house. Um, you just found someone who can't pay enough. So that completely changes it versus they won't pay anymore. Because it does bring the realization in of you know, if an owner wanted one point one, they might as well ask three million. It wasn't worth one point one, it's not worth three. Where where is enough enough?
SPEAKER_01:Yeah. Um that's right. And the see, where this has got to is first of all, the buyer should never have said they can't. And the agent, even if it has been said to them as a can't, they should reinterpret it to being they're just not prepared to pay more than a million dollars. Now, that's lying by omission slightly, but just presenting it saying they're not prepared to pay more than a million dollars, which is a true statement. We haven't said it's because they can't or won't, but that's not necessary for us to tell them that. But but where there this is where the agent comes in. And it's a skill and it's an ethics, it's um a desire to do their the best job by everyone involved. And uh the agent at this point, first of all, they have to work out whether the buyer was a can't or a won't. And if they're a can't, well, let's address can't. Can you get some more money from the bank? Can you go back to them and talk to them? Can you talk? Can you call in the bank of mum and dad? Um, you know, if you want this property, let's dig deeper. So you've got to address the can't. And out of that you may end up with a slightly higher price. They may be able to dig deeper and come up with a higher figure. The can'ts, um, sorry, the wonts are different because now they're saying I won't pay you more than a million dollars. Well, that's their opinion. And who's the expert around here? And so we now address the the won'ts with comparable sales. You know, what makes you think this isn't worth any more than a million dollars? What about the one over there? What about this one? What about the other comparables? Or what about the included values that you so cleverly have talked about in presentations? And just use your superior market knowledge to help them feel comfortable, the buyers feel comfortable, in paying more for the property. And that's just straight negotiation. So it's the agent's responsibility to decide are they account or won't, and address them differently. And once they get this high offer, now maybe it's a touch bigger than a million dollars, then their job is to decide is that a good result for the owner, or are we likely to find a higher buyer, higher price than another buyer if we keep waiting? And so that's you know, that's where the agent comes in, is to really decide how do I play this. They submit the offer. Are they then trying to convince them that it's a good offer? Or are they saying, well, this is the best we've got, but you know, my reading is we might get more later, let's let's keep let's keep looking. So that's you know, that's what the agent's job is.
Lee Woodward:This is so powerful, and you can now see, Wayne, why the buyer booklets that we've developed in the past are a justification process for supporting the buyer to make a better offer. Uh, the digital web inspections that we create on property, that digital inspection with the photos, the floor plan, the video, all that information is to support that final grand finale of it's worth this or is it worth that? And if we can't find that supporting surrounding evidence, maybe the owner is right. And I really liked how you touched on both there of okay, if it is can't, well then let's go into i into the search to get you more money. But if it's won't, uh, that's a different conversation. But just understanding in this tip that just from two words, what a difference that is.
SPEAKER_01:It sets the entire tone for the negotiation, and at the end, even if you've got a cant, it doesn't mean it isn't the best offer you'll ever see. No, they might say I can't pay more than a million dollars, but the million might be the best offer that's around. And so just because it's cant doesn't mean that you know you you decide that is you know, I can't commend this to the owner. You have to decide, well, is that the best we're ever going to see? Well, if it is, then I need to present it as the owner that that is more than an acceptable owner, and make sure they don't knock back something that that uh that is the best they'll see.
Lee Woodward:And you can even cross-confirm that with a purchaser where you say, you know, the person say, look, we can't go any further. So you won't pay any more. This is it. Yes, that's right. Okay. Yeah. So now that's the point. Yeah, you are tying them down to they and it's like that dialogue of, you know, what is your walkaway price? If someone paid five dollars more than you're offering now, you wouldn't be upset, it's your walkaway figure. What would that be? And it's amazing how this chip and chase of the negotiation or the collaboration with the purchaser can make such a difference. When you've studied negotiation all your life, what got you really good at this?
SPEAKER_01:It's uh good question. It's it's well, I'm not even sure I've studied it all my life. I've studied it in no, I haven't read that many books about it. I've I've read um I've read the basic ones, but you know what it is, Lee? It comes back to having the ability to put yourself in the ears and mind of someone else. So when you say something, you have to be able to jump to the other side and think, how would that sound to me if I was told that as a just a normal person who doesn't know anything else, like the idea of carp is wrong. You know, most people just skip over that. But but then some people think, oh, gee, they can't pay anymore, you know. And they don't even maybe verbalize it, or but they just don't feel right. There's something wrong there. So it's all of those things where I just feel for the wrong things. There's there's, you know, I talked about body language, but something when you someone makes you an offer, something I learned from the Chinese actually, you go, pfft, and look as though they've almost assaulted you. You don't have to say a thing, but just go pff and and and wince. And and they sort of inherently feel, oh, I've almost offended. You know, I just haven't offered enough. And by just doing that, they can often make you a higher offer without you saying anything.
Lee Woodward:The the flinch, as it was called, that you know, whatever offer comes in, you've got that flinch or that, you know, concern. And it's interesting also, Wayne, that you know, many times you can have a purchaser and you can set them up for the negotiation, no different to set up to sell. Setting up to buy becomes really important. But I would say to many buyers to say, look, I've got a property I'm gonna take you through off portal. No one's seen it at this point, and I think you're gonna engage with it. It it's definitely the best I've shown you out of all the properties we've looked at in your range. But can I ask something from you? If you do engage with the property, you do like it, can I ask you not to put some low, silly offer in as people do at times, as I think you're just gonna offend the owner. They're very passionate about their home and may not want to release it to you.
SPEAKER_01:Exactly. Offending the owner is something something I often use. Look, I'd rather not present that because what I really fear that when you come up with a higher offer, the owner might already have decided that they that you've tried to you know buy their property, label their property. So, you know, I highly recommend that you don't ask me to submit this offer because we might do harm. And I'm using words there like we, we might do harm, which is a concept known as false teaming, where you're selling to the buyer as we're on each other's side. And I'll sometimes say, look, what I think we should do here is come back with our best price. So you give me the best opportunity to have a good conversation with the owner. I mean, what I just said there that we are going to make an offer, I'm going to almost work for you, but I didn't say I'm going to work for you, I'm going to go to the owner with something and have a good conversation. And so this whole concept of teaming with your buyer to help them is something that I just naturally fall into. Um and so there's many elements of that where you you just feel of how you can persuade someone. You can say, look, I don't mind if you don't buy this property. But the worst thing I've ever seen in real estate is the regret buyers have when they didn't get ended up with a property and they could have bought it if only they had put their best foot forward. So what I want us to do is not have that regret. You give me your best figure, I'll go and present it, and if it's a no, then we're all happy. So it's this sort of because that one of the things that people don't realize that there's no um conflict in real estate sales. What does the owner want? Well, they want the best price. As you know, we used to hear years ago, they want all you take from a property is a check and memories. But what does a buyer want? I've never seen a buyer buy a property just because it's a low price. Buyers want the right property. So we can do everything we can to fight for a buyer to get their right property and at the same time work for the owner to get the highest price. And if you are part of the negotiation where a buyer doesn't buy a property that they should have bought, you are the problem. Because you didn't persuade them to do what they should do.
Lee Woodward:Yeah, and once that buyer walks away and the property sold to somebody else, maybe not at the same level or even above, they still don't have a property. And they say that buyers all the time, say, okay, let's say you don't buy this one, what are you going to do? Oh, we'll keep looking. Okay. And you'll probably find something out there, probably not as good. You might have to pay another ten. Why wouldn't you put that ten towards this one?
SPEAKER_01:Yeah. And and the scenario, would you be okay if I ring you next week and say it's sold for a figure that's a little bit higher than yours? How would you feel? Now, if you feel, oh god, you know, why didn't I then we have to do that now? Don't I don't want to ring you on a week's time and tell you you've missed the property. I want you to know now. And if we say, if they say no to your best offer, then you can feel you've done everything you could possibly do, and then use no regrets. But uh, let's work on making sure we don't have any regrets on this. It's that false team again. But but I'm actually meaning it. I want that buyer to to buy that property that's right for them. And if they don't want to buy it, that's fine. Let's sell them something else.
Lee Woodward:Now, when dealing with the owner on this one, Wayne, what's your thoughts when the owner's not accepting a a a brilliant offer, they can't see it, they think they're going to get more. What's your final words to the owner here to make sure they understand the situation of walking away?
SPEAKER_01:Yeah, this is one of the this is one of the most difficult things in real estate because when you get a Offer for an owner, and the owner's looking to knock it back. Most agents feel quite distressed that my God, they're going to knock back a really good offer. I have to persuade them to take this offer. And it turns out that they often go into urgency and pressure. Look, you must take this offer. We're never going to see another one as good as this. And done in the wrong context, the owner can't tell whether you're being so animated and strong about this as to whether the offer is really good or you, the agent, just want to get this thing done. And because they really don't trust us at one level about what is our motivation. We only get paid if we get sold. It doesn't really matter what prices is as long as it sells. So they can't tell whether the agent is actually pushing them to take a good offer or bullying them to take any offer. And so I had this dilemma for quite a while is how do you do this? And the answer is that firstly you just accept what they say. Okay, look, I hear what you say, it's not enough. What I'll do is I'll go back with your price, the one that you know that the buyer will not get to, but I'll go back and push for that. I think there's a 95%, 99% chance the answer is no. And then I'll start again. Let's get back to work. There's no one else in the pipeline. We'll go and look for someone else. So you haven't fought them, you just said you're going to do what they asked, go and try and get the center cheaper to offer, and and then start again. I'm completely loyal. Now then I leave it there and I hang up the phone. I love doing this on the phone. You can't do it face to face. And then ring them 20 minutes later and say, Look, I'll tell you what happened once. Years ago, I had this offer that was very, very good, handed it to the owner, he knocked it back. I thought I'd told him that it was a really good offer and that he's more than acceptable, but he said no. What happened? Weeks later, he fires me. He appoints another agent. Weeks later, he finally sells the property for about 8, 9% less than I had negotiated. And they think, oh, yeah, typical real estate, this sort of thing gets you. Anyway, Bill, that guy, Bill came in and said to me, Wayne, why didn't you tell me to take that offer? And I said, Bill, I thought you knew that it was a very good offer. I didn't want to tell you to take it. I don't tell people what to do, but I thought you knew that I thought it was a very good offer. And he said, Well, I didn't. He stormed out, but never spoke into Bill again. And I could have then said, Bill's an idiot. But I thought, no, I failed. I didn't convince Bill that he had a very good offer that he was knocking back. So I just tell the story to the person, and I say, Look, I'm not telling you to take the offer, but I am saying it is a very good offer. And I don't want to have another bill in my life. And so they invariably say, Well, thanks, Wayne. Um let me call you back. Two minutes later, something like between 19 out of 20 and 99 out of 100 times, they'll call me back and say, We'll take the offer. Because I've separated the that I'm on their side. I don't mind what they do, but I they have to know they're knocking back a good offer. If I made that clear and they knock it back, I'm sweet with that. And I think, you know, I can't even remember the time, the almost negligible time, so then this ethic went the other way. But they say, thanks, Wayne. I really value you're telling me that, and I'm 100% prepared to back myself in on this one. If it goes belly up, it's all my fault. But nine in nearly every single time they accept your offer.
Lee Woodward:Love that, Wayne. And the fact uh big tip for our listener there is it's the timing between one phone call and the next one, and then going back and doing your duty of care to let them know that and I love what you've done with the separation of not telling you to take the offer, but I am saying it is a good offer. They're two different things, it's like can't and won't.
SPEAKER_01:Yeah, exactly. Yeah. Because a lot of people don't like to be pushed to do things. In fact, if you ask me where my negotiation comes from, one of the things I hate being told what to do. And to the point where if someone tells me to do something that I should do, and I won't do it because I don't want to do what someone told me to do. It's just so you know, I I can see that about myself. And so that's why I inherently make sure I'm not telling people what to do, but I'm making it clear what I think they should do.
Lee Woodward:It's just a way of praising it. Very powerful. Well, Wayne Marriott, I think you're someone we're going to hear from in the future on this incredible topic of negotiation. I know it's one of your passions as you study this ever-changing wonderful industry, but absolutely amazing to have you on the programme. I want to thank you for joining us.
SPEAKER_01:You're very welcome, Lee. It's a pleasure.