Tuesday, 23 August 2016

Hunter Estess - Make the Invested Time Principle Work in Your Favor

Hunter Estess of New Orleans is a major player in the real estate market in the Gulf South region. He knows how to negotiate successful real estate deals.

The invested time principle states that the more time a person spends on a negotiation, the less likely he or she will get out of the negotiation without making a deal.
Hunter Estess

When you are looking to buy a real estate property and make an offer, the sellers immediately start spending the money in their heads. The longer the negotiation lasts, the harder it is for them to back out of the deal, because they see the money as if it were already theirs.

When you are selling a property, the buyers usually start envisioning what they will do with the property as if it is theirs before they buy it.
You can use this principle to your advantage by making the other party spend a significant amount of time on the deal. Get the buyer or seller to review or submit financial statements. Ask them to make projections of cash flow, expenses, and profits. Get engineers to take a look at the property. Do a title search.  Discuss the concerns with the other side. Send requests for more information.

Most people hate the idea of wasting time. After they spend enough time on something, they really want to make it work.

This being said, you shouldn’t forget that spending a significant amount of time on a deal will most likely have an impact on your decisions as well. Try to keep your work to the minimum and have the other party spend as much time, money, and other resources as possible. That is what smart real estate investors like Hunter Estess do when it is appropriate and beneficial for the negotiation.