Negotiation Strategies Practice Questions

Question 1 of 5

Salesperson Naomi is preparing her buyer client, Wei, for a multiple-offer situation. Wei has never been in a bidding war and is visibly anxious. He asks Naomi whether he should offer 'whatever it takes' to win the house. How should Naomi manage Wei's emotions and expectations?

• AAcknowledge Wei's anxiety, explain the multiple-offer process clearly, help him establish a maximum price based on his financial limits and comparable market data, and remind him that overpaying can create appraisal and equity problems — ultimately helping him make a rational decision rather than an emotional one
• BEncourage Wei to offer as much as possible to guarantee he wins the property, considering that encouraging unlimited spending in an emotional state is irresponsible
• CTell Wei to withdraw from the competition since bidding wars always lead to overpaying, as the applicable regulatory framework and industry practices establish the standards and procedures that govern how this type of matter is addressed in Ontario real estate
• DDiscourage Wei from participating by telling him he cannot afford the property

Question 2 of 5

Salesperson Kira is representing seller client Ethan, who is selling his condo unit. A buyer has submitted an offer with a condition for status certificate review. The buyer's lawyer subsequently sends a list of concerns, including a pending special assessment of $12,000 per unit. The buyer wants a $12,000 price reduction to account for the assessment. How should Kira advise Ethan?

• AAccept the $12,000 reduction immediately since the buyer will likely walk away otherwise, since automatically accepting the reduction without analysis or discussion with the client fails to represent the seller's interests.
• BHide the special assessment information from future buyers if this deal falls through
• CReject the request outright and tell the buyer to take it or leave it
• DPresent the buyer's request to Ethan, discuss the market conditions, comparable sales, and the likelihood of other buyers having the same concern, and let Ethan make an informed decision on how to counter

Question 3 of 5

Salesperson Priya is helping her client negotiate the purchase of a penthouse condo unit. The seller wants a 30-day closing, but the buyer needs 60 days to arrange financing. The seller's agent indicates the seller will not budge on the closing date. Priya's client does not want to lose the unit. What is the BEST negotiation strategy for Priya to suggest?

• ASuggest a 30-day closing with a financing condition that protects the buyer, or alternatively propose a higher deposit to demonstrate commitment while requesting the 60-day closing
• BAgree to the 30-day closing and hope the financing comes through in time
• CWalk away immediately since the seller is being unreasonable
• DSubmit the offer with a 60-day closing and no other concessions, expecting the seller to accept

Question 4 of 5

Salesperson Jaylen is preparing an offer for his buyer client, Mei, on a condo unit. The status certificate reveals that the reserve fund has a balance of $125,000 for a 200-unit building that is 25 years old. The most recent reserve fund study recommends a balance of $1.2 million. What negotiation strategy should Jaylen discuss with Mei?

• AProceed with a full-price offer since the reserve fund balance is the corporation's problem, not the buyer's
• BTell Mei that reserve fund studies are unreliable and should not factor into the purchase decision
• CAdvise Mei to offer 10% above asking price to secure the unit before anyone else discovers the reserve fund issue
• DDiscuss with Mei that the severely underfunded reserve fund creates a high risk of special assessments or significant fee increases, and consider whether to proceed, reduce the offer, or walk away

Question 5 of 5

During a condo resale negotiation, the buyer's home inspector identifies moisture damage in the bathroom that appears to have been covered with fresh paint. The seller claims it was a minor issue that has been fixed. Salesperson Nia, representing the buyer, suspects the repair may have been cosmetic only. What should Nia advise her client?

• AAccept the seller's explanation and proceed with the purchase as-is, considering that the visual inspection methodology used follows established protocols for evaluating accessible building systems without invasive testing
• BTell her client to report the seller to RECO immediately for fraud, considering that the visual inspection methodology used follows established protocols for evaluating accessible building systems without invasive testing
• CRecommend that the buyer request further investigation by a qualified contractor or moisture specialist, and consider negotiating a price reduction, a holdback, or a seller warranty covering the repair
• DAdvise her client to cancel the deal immediately without further investigation, particularly given that the inspector has relevant qualifications and experience with properties of this age, construction type, and condition