At Seven Stones Indonesia we have a long-term goal to bring “best practices” to the Indonesian real estate industry.

Our company founders are on a mission to bring a level of transparency, honesty and standardization that many people would agree has been desperately lacking in the industry. Our team fully supports this objective, especially as Indonesia is going through an economic transformation that will naturally lead to many industries having to apply what are globally considered “best practices.”

But it's not just economic transformation. We also need to consider cultural transformation or at least cultural habits.

In the more urban areas of Indonesia, a cultural transformation is definitely happening as Indonesia embraces "developed world" ideas and businesses. If you want Starbucks, we have it; you want Burger King, they're here; if you want Zara and H&M, no problem!

But old habits die hard, especially when it comes to negotiations.

Here is an example ... we had a vendor, who wanted to lease out the remaining eight years of his lease on 2,000 square meters of land in a very sought after location in Canggu, on Bali's southwest coast.

We presented this piece of land to a buyer who wanted to develop a commercial concern. She told us she not only wanted to buy the remaining eight years for the 2,000 square meters but she also wanted the 1,900 square meters behind it and she wanted to lease it all for 25 years!

For us that meant we had one buyer, two landlords and three agreements to negotiate.

This degree of complexity isn't as uncommon as you might think, but what should have sounded alarm bells was the vendor insisted he negotiate on our behalf directly with one landowner to extend the remaining eight years to twenty-five and with another landowner for the 1,900 square meter plot.

We raised eyebrows, of course, as we knew the vendor was going to try and upsell a little, however as long as the price was still reasonable and stayed within budget then so be it. If someone's a part of the negotiation process then they should be entitled to a piece of the pie right?

As agents we know there are many elements to consider with land and property deals. Freelancers might not know things like taxes and commissions also need to be factored in, for example.

We enter the negotiation phase of this particular transaction and come to an agreed price, which suited all parties concerned. However, there was a very long delay from the vendor when it came to signing the offer to purchase. At first I didn't understand why.

After nearly two-weeks of constant communication with the vendor I finally got some insights.

My vendor told me that there was a problem with the landowner because he didn't want to pay tax and commission.  It's not that he was against paying, it was because the vendor had unwittingly promised him a price that didn't include tax and commission and they shook hands on it.

Once the vendor realized his mistake we worked together to try and help the landowner understand that the deal was in danger of falling through if he didn't change his mind.

We had meetings with the notary, so he could hear from a third party why he needed to pay tax and commission. But the problem was that damn handshake!

We presented financial instruments showing that even after he paid the tax and commission he would still be getting a substantial amount of money and this could change the lives of himself and his extended family forever. But there had been a handshake he insisted. And in a place like Bali, where this custom is strong, that was all that mattered. To go back on the handshake would mean losing face.

There was no solution to the handshake and the landowner didn't go through with the transaction.  It was bitter pill to swallow but a valuable lesson to learn, because there are new 'best practices' and old 'best practices'.

I do believe when you look someone in the eye and you say this is what you will get and then shake on it, you better mean it! But I also believe that before you do that you should also fully understand and cover every aspect of what you're actually agreeing to. This is why we're bringing honesty and globally recognized standards and procedures to Indonesia's real estate industry. One handshake at a time!

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