Tactful

Tactful                                                        Best Practices Series 2020

“A successful negotiator finds out what the needs

of the other party are and tries to meet them without

losing sight of his/her own goals.”

People are emotional beings and words, how you say them matters. 

You can motivate more people to action with empathy,

compassion, understanding by listening

kindness and sweet words then harsh and demeaning

conjectures and personal attacks.  

How do we deal with difficult people? 

Tactfully. 

Real estate is as much about people as it is about property. 

Working, negotiating and closing on an agreement to

purchase or lease a property is more 

about the people and the interpersonal relationship between them. 

You and I will be dealing with all kinds of people,

most people are wonderful.

However when you encounter a difficult person,

try to understand them first. 

Listen to them, hear what they are saying. 

Understand their motivation(s). 

What they would like to achieve, why and when?

What they dislike, why? What they want to avoid? 

Ask them to tell you a little more about it. Know the full picture.

When you understand their real motivation and you show you really care

 then your life and negotiation will be easier.

“Know the end point, you will know the journey.”

Mark McGuinness [ Wishful Thinking , Blog : a business coach ]

offers these four steps for addressing the difficult behaviour of others; 

1. Take the “difficult” label off the person. You are dealing with a difficult situation, not a difficult person.”
2. “What do I want them to do?” Be specific in determining your request and remember you are not trying to rebuild their personality, just to influence their current behaviour.
3. “What’s in it for them to do what I want?” If you can give them a good reason – from their point of view – most likely they will do it. 
4. Be firm but friendly…

We can make ourselves “ more accommodating to others

without comprising our ethics, morals and

standards or letting anyone walk all over us. 

When we do this we can often defuse tensions before they can

build into a conflict.”  

Peter Legge in “the Power of Tact” suggests you consider

“the four “Cs” that will help you get along with almost anybody;  

Communication , Cooperation, Collaboration and Compromise.

                                     Tactical Manoeuvres 

“Keep difficult people in perspective and do not expect them to change”.

Control yourself and don’t let your feelings get too intense.

You have options; “asking for politeness or leaving”.

“Understand that it’s okay to disagree.

The important thing is respect for each other’s differences

so you can maintain a working relationship.”

“Be patient with yourself. Look at each exchange,

whether good or bad, as a lesson on how to deal with others.” 

“You can often turn a bad situation to your advantage by

disarming people with kindness and allowing them to feel important.” 

“If possible, plan ahead and prepare your tactics when dealing

with a difficult situation.

Think about the result you want.

Stay calm and keep your emotions under control. 

Be straightforward and matter-of-fact.” [the Power of Tact : 2008]

Be a student of human nature and behavioral economics,

learn with each encounter by listening, 

communicating mindfully and understanding the

desires of the wonderful people you deal with 

for their success and yours. 

Our team of professionals would be happy to represent and negotiate your real estate acquisitions, divestitures, leasing and asset management.

We are open to virtually meet with you, your family or group and discuss your needs. We can be reached at ; capitalmoves@gmail.com

We are always interested in speaking to energetic and ethical professionals to join our team at Envoy Capitol Realty Inc., Brokerage.

Reach out to us and let’s talk.

Envoy Capitol Realty Inc., Brokerage Toronto (416) 441-6163

You can check out our books at Amazon.

Value Range Estimates

Value Range Estimates

What determines future market conditions? 

What set of assumptions are more valid in order for us to forecast 

future cash flows of an investment? 

What constitutes risk to our current market condition? 

If we can identify, assess and try to understand the risks and quantify 

the probabilities than we can get closer to making better forecasts that lead

to better decisions. Better decisions lead to better investments.

This is a never ending task as you can appreciate, as situations change

and new information alters our confidence about prior views, positions taken 

and the direction we were heading.

In the past we had a preference for single-point valuation after researching 

data comparable to the investment(s) and relying on a set of assumptions 

about; the property, the neighborhood, cost of capital, inflation, market conditions

(supply demand dynamics), governmental policies and the competition

(current and future). 

The idea of risk was a non-factor or simply down played in calculations in the 

past for most small to mid level investors.

Most investors and lenders would prefer a single-point value to make their investment 

and to lend capital upon as this suits their immediate practical needs.

“Real estate investment analysis often assumes typical economic conditions

(moderate inflation, stable taxation policies and regulations, events within the

scope of reasonableness) when calculating present values (PV) and internal

rates of return (IRR); desired yield of investors.

Unfortunately, real estate markets possess the disturbing ability to confound

analysts. Elaborate probability calculations may be warranted, but most

exceed the practical needs of “ brokers, lenders and investors. 

  

Single-point valuation is fast and easy however the markets and the world is more

risky and complicated then this practical application. 

Whatever assumptions will or perceived to have an effect on future cash flows

of the investment must be considered in a comprehensive analysis, this is where

value range estimates enters the discussion. 

 

Value Range Estimates addresses a broader range of assumptions based on differing 

discount rates is a more valid approach when calculating an estimate of

present value (PV).

“A range of values provides the investor and lender with some indication of the effect

that certain events can have upon value and quantify, at least to some degree, the risk

associated with the decision.” [REIA,OREA] 

 

These differing discount rates affect the values that the forecasted cash flows  are

based upon research of the historic range of these differing discount rates the investor,

appraiser or lender may use a two to five percent range to adequately address the

risks and concerns assessed over the timeframe of the investment.

If we  use a three percent discount rate adjustment that our market research supports ;

and consider a range from high to low upon the equity yield rate the investor desires. 

The following table gives us a range from high to low on either side of the investor’s 

estimate of value for the equity of a given ten year cash flow forecast of an investment. 

Differing discount rates with closer proximity are usually utilized in a 

value range estimates analysis.

Too large a range and the values become meaningless and too narrow a range may

defeat the purpose and value of this investment decision making tool. 

We have tried to simplify it here to expedite the process. 

Table : Value Range Estimates 

 Range of rates :  [low rate]  … [single-point value]   …   [ high rate]

Discount Rates :     9.5%    …               12.5%  …            …      15.5%

PV Cash Flows :  $ 996,879    …       $802,834          …       $654,300  [Value of Equity]

 Value Level:     [High value]    [single-point value]   [Low value]

[ REIA OREA ]

This example and the differing discount rates provides an investor with the potential

range of  values based upon differing assumptions and considerations.

The example illustrated three percent discount rate below and above the investor’s

desired yield with the extremes being a 6 percent differential.

The illustration shows the dramatic effects of discount rates on value 

consideration; a low discount rate will show a higher present value and a

high discount rate will show a lower present value of the cash flows.

To complete the valuation the present value of the mortgage would need

to be added to each estimate of present value of the cash flows (equity) to equal the total

estimated of present value for the investment. 

When doing a Value Range Estimates for a cash flowing property use

appropriate differing discount rates relative to the asset and the set of

assumptions being considered.  

The above was for educational and discussion purposes illustrating a tool

to be considered when evaluating income producing opportunities,

every real estate investment is unique and the appropriate

professional should be consulted to assist the investor in making better decisions. 

Envoy Capitol Realty Inc., Brokerage has the ability to meet with clients virtually

and discuss all your real estate needs.

Our team of professionals are here to help you make better decisions.

We are always interested to speak to new team members salespersons and brokers

who have high professional and ethical standards.

Let’s talk, there is more in it for you here.

Check out our books on Amazon :

@ 2020 reserved

Email us at :  capitalmoves@gmail.com and we can set up a meeting.

Envoy Capitol Realty Inc., Brokerage

3219 Yonge Street, Suite 227 Toronto Ontario , Canada M4N 3S1