As some high-demand markets and areas are red hot with limited inventory, we are seeing bidding wars with multiple offers on a house or property which can result in a bidding war.
Here are a few tips to win a bidding war and if you’re the seller how to pick a winner. Don’t forget to get feedback from your real estate agent as they may have important knowledge about the seller. And don’t get too frenzied where you bid yourself to a point where its going to break your budget!
Up the Ante
Of course if there are multiple bids on the property, increasing your offer is going to help. In addition you can make a larger down payment on the mortgage to make financing easier, especially if the purchase price goes above the appraised value. And the old saying cash is king is applicable here as well. Paying in cash shows you’re serious and it also can make for a faster closing.
You’ll want to do this anyway but definitely make sure you are preapproved as it shows you are a viable buyer. Please contact us for a pre-approval letter whether you are in a bidding war or not!
You can also add an escalation clause where if someone matches your offer you will raise your offer above it!
Write a Letter
This may sound hokey but we have seen a lot of cases where sellers want their house to go a buyer that is going to care for and appreciate the house. Tell them why the house is special to you and you might not even be the highest bidder and still have the winning offer!
Picking a winner
If you’re lucky enough to be on the selling end of a bidding war here are some tips to pick a winner. Again cash is king. Cash offers give you a lot more certainty that there won’t be surprises during the closing. And if its not a cash offer review the buyers offer, make sure they are preapproved before starting. Also review special offers and escalation offers like an offer to waive some contingencies or beat matching offers.