The purpose of this exercise is to apply the five negotiation skills presented in this chapter to an actual negotiation situation. You have been looking to buy a home in a particular neighborhood because you like it and it is in the best school district. Your family needs at least four bedrooms, and two and a half baths, and a two-car garage. At this time you have twice viewed one house that meets all of your needs and is located at 5656 Valley Oak Court. Your agent has provided you the information on this house as well as the other five houses (A-D) in the neighborhood that meet your criteria and have sold in the past year. The house is listed for $329,000. Review the following information and answer the following skills questions:
SKILL 3.1: Is this a distributive bargaining situation? Why or why not?
SKILL 3.2: How will you determine your reservation price?
SKILL 3.3: What initial offer should you make to use "bracketing" and achieve your target price of $310,000?
SKILL 3.4: Which norm(s) can you utilize in presenting your initial offer?
SKILL 3.5: Frame an initial offer that incorporates the norm(s).