7.1 Initiate Early Discussions
When you find a Lombok land parcel for sale that interests you, the initial discussions are a time to learn as much as possible about the land. You should meet the owner and try to get to know him or her. You should learn about the other people involved in the transaction. Does one person seem to influence the conversation more than others and giving you quickly, overly simplistic answers?
You will also be carefully studied by the others. Lombok culture still have a loose cast system. Names carry titles that indicate who comes from a respected family. In their eyes, you are a stranger and you will be judged on your composure and body language. Don’t forget to shake hands with everyone. Speaking Bahasa Indonesia is certainly something positive, even if only with a few words or greeting phrases. Respectable clothing also helps to gain respect, ask your partner what is expected of you in various situations.
When getting to know the owner of the land, the family and the village surrounding you, you will accumulate a lot of information useful in the negotiation stage. What is the motivation for selling the Lombok land? How much money does the owner need. If the owner needs half the selling price of the land quickly, you may wish to pay the remainder in a year or when the certificate is in your hand, which typically is earlier than a year. Since you probably don’t speak Bahasa Indonesia or Sasak well enough to discuss these details, your partner should be with you. A good translator is of vital importance since body language surely is different from what you are used to. Sometimes an eager discussion can seem angry in your eyes for example. What is being discussed can be meaningless random idle chit-chat or something of vital importance. Perhaps someone might tell the owner to raise the price of land because you are a rich person. You must understand that you need someone on your side that understands the culture and the languages. The locals typically speak Sasak more than Bahasa Indonesia so Bahasa Indonesia is not sufficient. Don’t be afraid to stop the conversation and speak with your translator or partner in private.
7.2 The history of the land
The most important issue that always should be in your mind is the issue of clear ownership. Any parcel of land can never become the property of your nominee until a Land Certificate is issued from the Government Land Office (BPN). You will be granted a period of time later in the process to investigate the propery’s history of ownership. This is a complex issue discussed separately in the chapter Due Diligence and Research. From the very beginning of the discussions you must maintain a healthy skepticism that this could be a scam.
Is there a land certificate issued already? Any other people on the certificate besides the owner? Are any other family members claiming ownership of the land? Is the owner willing to discuss any issues now that will be discovered later? Make sure that the owner shows you the corners of the land and try to appear interested but concerned in the land. Maintain your poker face, i.e. don’t display a strong desire to buy the land early in the process. There are still many steps in the process and you want to make sure to be able to walk away without anyone feeling guilty or disappointed.
7.3 Get to know the Players
The property agent that showed you the land will off course be attending but who are the other people in the room or on the berugak? Anybody with an interest in the property (middlemen) will also be in attendance. Make sure to write down names and how they are involved in the process.
Be careful of listening to advice from anyone else than members of your team. Almost everyone will make more or less money if you proceed with the transaction and buy the land. It is natural that they have a natural bias to make everything seem wonderful.
If you will face a pressure sales technique pitch such has “we have another family who wants to buy this land right now” or similar this should cause a warning signal to go off in your head. To get back in charge, your response should be something like “I am not interested in talking about buying land that already has a buyer”. This will make sure that everyone understands that you are in charge and will not work with anyone using these pressure sales techniques. If you don’t get back in charge, it will only get worse later.
7.4 Slowly Get to the Price
Everyone are keen on discussing the price on the first meetings to settle the price and close the deal. There are several strategies that can be applied to lower the price. These strategies are discussed in further detail in the chapter Setting Price and Terms. Depending on your situation, accumulated information from the meetings and your partner, it is wise to think about a strategy for negotiations. Typically a fast negotiation process is necessary when the owner needs the money quickly, but long and delayed negotiations are also common to lower the price. It all depends on the situation.
Never agree to settle the negotiations until the due diligence process has been completed. The investigation may uncover problems such as the need to pay a neighbour a substantial amount of money for clear access rights through his property. The land purchased at a bargain price might render almost useless if the access road right is to expensive.
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