Negotiation Role Play Selling A House Mgt 265 Medaille Colle

Negotiation Role Play Selling A Housemgt 265medaille Collegej Girard

Negotiation Role Play: Selling a House MGT 265 Medaille College J. Girard, MBA Listing: · 4 bedrooms · 3 bath · Williamsville school district · New Roof · New Hot Water Tank · Heated Florida Room · Wood burning Fireplace · $379,900 Home Buyer: You have found your dream home in a good school district and would like to put down an offer. You have excellent credit, and a substantial down payment. Interest rates on mortgages are at an all-time low. You are coming from an apartment, so you do not have to wait to sell another home before you can close on this one. There is another house in the same town that is similar, but is in a different school district. The school district is important to you as your daughter will be starting Kindergarten in September. Also, your parents live nearby and can be available to get your daughter off the school bus. You will need to consider additional expenses coming from an apartment, such as appliances, etc. The one drawback from this house compared to the other one, is that the kitchen countertops are Formica, and you like the look of granite. Home Seller: You are downsizing from your home where you raised your children to move into a patio home that is all on one level, and will be maintenance free. You cannot take all of your furniture with you as you are going from 3,000 square feet to 1,500 square feet. Ideally, you would like to move by December 1st so that you are all settled in to celebrate the Holidays. Since you haven’t had a mortgage in years, you are more concerned with a fast closing than you are with maxing out on the price. Role play the scenario, keeping in mind your BATNA, as well as the BATNA of the other party and remember the 4 Principles of Negotiation: 1. Separate people from the problem 2. Focus on interests, not positions 3. Create options for mutual gain: Expand the Pie 4. Use Objective Criteria 2-3 pages Summarize what we learned from the negotiation of selling/buying a house. · What were some keyways that both sides were able to "expand the pie"? · What were the interests of the seller? · What were the interests of the buyer? · If we had used distributive negotiation, what would the one thing have been that they focused on? · Explain why Integrative Negotiation is better than distributive negotiation and who benefits from it. · What are some great sources of objective criteria for home buyers and home sellers to utilize in a negotiation? Summarize what we learned from the negotiation of selling/buying a house. · What were some keyways that both sides were able to "expand the pie"? · What were the interests of the seller? · What were the interests of the buyer? · If we had used distributive negotiation, what would the one thing have be en that they focused on? · Explain why Integrative Negotiation is better than distributive negotiation and who benefits from it. · What are some great sources of objective criteria for home buyers and home sellers to utilize in a negotiation?

Paper For Above instruction

The negotiation between a home buyer and a seller is a complex process that benefits significantly from the principles of integrative negotiation. Throughout the process, both parties aim to achieve their respective interests while seeking mutually beneficial outcomes, which can often be facilitated by expanding the 'pie' of available options rather than competing over a fixed pie. This paper explores the core lessons from such negotiations, emphasizing how both sides can expand the pie, their primary interests, and why integrative negotiation techniques outperform distributive strategies.

Expanding the Pie: Key Strategies in Home Negotiations

One of the primary ways both parties can expand the pie in home negotiations is through open communication about underlying interests and constraints. For instance, the buyer's interest in securing a home within a desired school district and with proximity to family members' assistance caused the buyer to be flexible on certain features such as countertop material. Conversely, the seller's interest in a quick sale before the holiday season prompted offers to be more accommodating in terms of closing dates and potentially price. By focusing on interests rather than positions, both parties identified areas where mutual gains could be achieved, such as the seller being willing to include certain appliances or make concessions on the price to facilitate a rapid closing. Creating multiple options—such as a lower price with flexible move-in dates or including appliances—allowed the parties to broaden their considerations beyond initial fixed demands.

Seller and Buyer Interests

The seller's primary interest was to downsize and close quickly, ideally by December 1st, to enjoy a maintenance-free lifestyle during the holidays. Their focus was on a fast sale rather than maximizing price, as they had no mortgage to carry. For the buyer, interests included purchasing a home in a good school district for their daughter, proximity to grandparents, and avoiding the high costs associated with outfitting a new home. They also had a strong desire for updated kitchen features like granite countertops, which influenced their negotiation stance. Both parties wanted a satisfying transaction that addressed their core needs—speed and convenience for the seller, and location and features for the buyer.

Distributive vs. Integrative Negotiation

If the negotiation had been distributive, it would have focused narrowly on a single issue—most likely the house price. Both sides would be vying for the maximum reduction or the maximum offer price without regard for other factors. Such a win-lose approach might have led to a less satisfactory outcome, potentially causing one side to walk away if their demands weren't met comprehensively.

In contrast, integrative negotiation emphasizes collaboration and understanding the interests of both sides. It facilitates finding creative solutions that can satisfy both, such as agreeing on a fair price with flexible closing terms or including desirable features and appliances. This approach benefits both parties by fostering trust, encouraging cooperation, and often resulting in a more sustainable agreement. The seller benefits from a quick, hassle-free sale; the buyer benefits from acquiring a home that aligns with their needs and preferences, possibly at a better overall deal than they could secure through a purely distributive approach.

Objective Criteria and Their Role in Negotiation

Reliable, objective criteria are vital for grounding negotiations in fairness and factuality. Great sources include recent appraisals, comparable sales data in the neighborhood, and indexed market prices. For buyers, understanding current mortgage interest rates and standard closing costs provides a benchmark. Sellers can utilize recent sales prices for similar homes and valuation reports to support their asking price. Employing these criteria ensures negotiations remain fair, transparent, and less prone to subjective biases or emotional conflicts, ultimately leading to better outcomes for both parties.

Conclusion

In summary, successful home negotiations hinge on mutual understanding, interest-based bargaining, and creative problem solving that expands the available options—the proverbial 'pie.' Both the buyer and seller can achieve better results by focusing on their interests, working collaboratively, and leveraging objective data. Integrative negotiation fosters trust, efficiency, and satisfaction, making it a superior approach over distributive strategies that tend to pit parties against each other over limited resources. Ultimately, the ability to think beyond fixed positions and develop solutions that satisfy underlying needs benefits everyone involved, creating more sustainable and amicable agreements in real estate transactions.

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