Winning a Bidding War in Today's Market
August 29 2017
Buying a house can quickly turn into a bidding war in today's real estate market. Use the following tips and tricks to stay competitive.
Getting preapproved for a mortgage loan gives you an immediate advantage over other potential buyers. Sellers are more likely to accept an offer from someone they know is qualified for financing because it reduces the chance of the sale falling through.
If the seller needs to get out quickly, consider moving up the closing date to help them out. If they need more time while closing on their own new home, offer to rent the current house back to them while they finalize their move.
Other ways to demonstrate your flexibility include offering to pay more in cash to make up for a low appraisal or shortening the time you need for an inspection. You could opt out of an inspection altogether, but this isn't recommended unless you're 100 percent aware of a property's defects and potential repair costs.
If you're hoping to connect with sellers on a personal level, send them a handwritten letter noting all the reasons you love their home. If they raised a family there and you'd like to do so as well, highlight this shared interest. Your story and connection could put your offer over the top.
The escalation clause is another tool you can use to stay competitive without overspending. Use this option to speed up negotiations by including incremental jumps in your offer up to a preset maximum amount.
No matter which strategy you choose, it's important to remember that patience is key and your dream home is out there waiting for you.