Today’s real estate market is in the middle of the spring selling season, and many homes are receiving multiple offers very quickly. So how can you gain an advantage when the home you want has multiple offers? Here are six strategies that will give you an edge in a bidding war.
First and foremost, ask your real estate agent for advice! Good agents have knowledge of the market and selling season that can help you make an informed decision.
Sometimes, it’s best to play it safe and give the sellers what they’re asking for, either regarding price, closing deadlines, or both. Renegotiating prices too aggressively after an inspection can be a deal breaker, so ask your agent for their advice!
It’s not just enough to know for yourself that you can afford a home; you need to be able to prove it to others, too. Assembling a robust financial package is a key step in buying any home, but it is especially important when multiple offers are pending. Getting pre-approved for a loan will show that your finances are secure, and getting approval from an underwriter can lend extra credibility to your offer. If possible, pay cash!
If the home is being sold by a bank, it often sells to the first offer that comes in. But speed is important when you’re buying from the homeowners as well: it shows you are serious, and can create momentum in your favor before other offers come in. Once you’ve made your offer, go further! Include a copy of the earnest money check, and include a history of your agent’s deal timelines to show that the process will go quickly.
If you offer too low and get out-bid, you don’t want to regret that the offer you submitted wasn’t the best you could do. Conversely, you don’t want to over-bid with an offer that you might regret later. This is why it’s important to know the home’s condition and consider the current market value so you know when it’s best to walk away. It’s also a good reason to search for homes priced below your absolute maximum price limit, because you can counter-offer with confidence if you find yourself in a bidding war.
Nobody wins every bidding war! Take what you learn from a loss and add it to your bag of tricks for the next time.