Whenever you find yourself in a bidding competition, know that the end of the day there will be a winner and is case happens mostly when the house is a hot cake in the market. Most markets currently pose a challenge to the buyers, unlike the previous times when buyers had a chance to get upper hand.
The phenomena of bidding wars within the property market happen as a result of high demand and low inventory. You will always probably run into a winning war whenever you are bidding for a home that has many competing bidders. This is may not be the end though it is not ideal. You can always win in a bidding war if you apply some little strategic thinking by taking the right approach.
In most cases, you need to choose a strategy that will definitely suit the seller
Bidding War strategies
Offer The Highest Price
This is obviously a fact to everyone, but I had to mention it for everyone to get it right. The best way to outbid in real estate or in any other bidding competitions is placing a higher bid. If you just add up some few bucks on top of all other competitors, you may definitely win the bid.
The home workers will actually want to make a lot of money and the same case applies to the seller. In most markets, we have crazy sellers who make it hard for buyers but there are those buyers who take that have an advantage by paying more than the others pay.
Show Some Cold, Hard Cash
By giving a total amount of cash lets, the seller knows that you are ready to buy the house as soon as possible, nothing like third party denials, roadblocks or questions. It shows that if you can make an all-cash offer you have the money. Most people do not do that, therefore, it is important to be a bit different when going about that.
Having cash available is not the same as waiving the financial contingency which is still beneficial. There is still a risk of the seller if you really need a mortgage.
Use An Escalation Clause In Your Offer
An escalation clause, when used correctly, can be a very effective tool for securing a home for sale. The bad thing is that most of the buyers do not know how to use them. Most sellers too and agents are not familiar with how escalation clauses work either. You can try to think about what happens when you do not know how something works.
Here what you need to do is just convince the seller that you really want to buy the home and that you are ready to outbid all other bidders and make the home yours. This clause is often misused by the escalator terms or simply the amount of money the buyer will exceed the price of the highest bidder.
Write A Personal Letter
This will help you pull on the seller’s head strings, here you can list the things both of you have in common such as children and family life. You can still mention things like how the home will be a good place for your children and the service they may offer to the community. Try as much as you can to put a little heart into the letter and be honest.
Waive Your Financing Contingency
This can seem a bit scary though it can be done with minimum risk on your end. All you need is finding a lender who will comply and give you enough money in terms of a loan pre-approval.