Review: Tips & Traps When Negotiating Real Estate

In this collection of tips about all aspects of negotiating a real estate transaction, Robert Irwin reaches back through decades of real estate experiences and helps the reader learn through real life stories.  “Tips & Traps” is actually the name of a series of books that Irwin has written about real estate, with one book each for the topics of of negotiating, selling, buying, condos, and more. This book reads more like a collection of stories than a cohesive book on negotiating, but that’s the whole point with the series title of Tips & Traps. Irwin goes through the various aspects of a real estate transaction chapter by chapter, and intersperses his writing with text inserts titled with “Tip” or “Trap”, where he highlights the main traps to watch out for, or a tip to be sure to remember. Very easy reading, and with hundreds of useful nuggets of wisdom throughout.

This is a great book for the potential buyer. Irwin presents a general outline of how to go through the entire process from choosing an agent to choosing a house to closing and renovating. For example, in chapter 1, Irwin gives advice to the buyer in how to manage their agent, and to not just do whatever the agent wants. Some agents tend to want to maintain good relationships with everyone in the community, and fear that aggressive dealing or low offers will make people not like them. Irwin reminds the buyer that an agent should not be afraid of tough negotiating–if anything, a reputation for strong representation can only help an agent with referral business and an image of integrity and strength. Irwin points out a trap for this topic:

“Some agents don’t like the pressure of tough negotiating. If that’s the case, then either demand that your agent perform to your desires or get a new agent.”

Irwin also covers most of the basic customs and rules in how a home is purchased, from making offers, counteroffers, to signing the P&S and doing inspections.  In chapter 7, Irwin covers how to negotiate a broker’s commission, but also ends up covering how brokering works, how the commissions are split, and how some brokerages offer discounts and whether or not one should consider these discount brokerages.

Near the end of the book, Irwin provides advice on how to deal with banks, and reveals a surprising number of ways in which one can negotiate with banks, and in what situations you cannot negotiation with banks. The following tip describes different types of mortgage brokers, and why you might want to be very picky about what type of broker you choose:

“It’s usually more difficult to negotiate with a direct lender such as a bank or savings and loan because you generally don’t get the opportunity to talk to the right person. You usually talk to a loan salesperson who simply mouths the lender’s policy. “We have loan A, loan B, or loan C. Take your pick.” If you can get in to see an officer who has discretionary powers, it is possible to get a loan tailored to your needs. That’s why it’s sometimes best to deal with a small lending institution instead of a giant one—or better still, a mortgage broker who has the ear of the lender.”

In the final chapters, the author has information for investors and those that want to have a house built. From calculating the return on investment to how to negotiate contracts with builders such that you don’t end up with an unfinished un-permitted house, Irwin seems to cover it all.

As a real estate agent, I found this book to be invaluable in that I got to read about hundreds of real life examples of transactions with issues–from contingency situations where the buyer, seller, and the person selling to the seller all needed to close on their houses at the same time to client relationships that really should be let go of in order to maintain integrity by ensuring the best services for the client, the stories were all informative and many times entertaining. It’s also a good refresher of a broker’s obligations to their client both according the legal rules from our states as well as according to the ethical rules from the National Association of Realtors.