The real estate market is incredibly competitive and buying a property can feel like a war. This is especially true when you are trying to buy in an area where there are limited properties on the market. The worst part is that you often find yourself in a bidding war with other buyers. But don’t let these conditions discourage you. Once you master the art of winning a bidding war, it will have a profound impact on the way the deals fall in your favor.
Here are some proven techniques that will help you to win a bidding war on your dream home successfully.
Start with a Plan
If you want to win a bidding war, the first thing you need to do is get organized and make a plan. Do your due diligence and research the local real estate market to determine the typical prices for properties in your target area. Create a budget that will allow you to stretch your finances without putting you in the red. This budget should be based on what you can afford and should include a pre-approval letter from your lender. Also, be sure to have all your finances in order so you can promptly submit your offer.
In a bidding war, time is of the essence, and you can be left behind if you’re not adequately prepared. Make sure you know the seller’s timeline for selling the house and what is important to them. That way, you will be in a better position to adjust your plan accordingly. If possible, it’s a good idea to be on the first line for open houses or make a pre-offer.
Make a Strong Bid
The strong bid is a bid that demonstrates the value you place on the property. You have to make your offer competitive to stand a chance in a bidding war. Beyond that, don’t let your personal attachment to the property lead you to go beyond budget. Also, remember that Cash is King, so if you can afford it, always consider paying cash or a sound deposit. People are more trusting and willing to sell to someone with proof of immediate cash, so consider this option seriously.
If you’re serious about winning the bidding war, you may want to add incentives that make your offer stand out. One of the most popular incentives that may help your case is to offer to close within 21 days. You could also offer to cover some of the closing costs, more than the standard amount. These gestures make the seller feel cared for and more open to selling at your price.
Have a Backup Plan
In a competitive real estate market like this, winning isn’t always guaranteed, no matter how well you plan. So, it’s essential to have a backup plan if your first choice falls through. Consider looking for other properties in the same area or working with your agent to find off-market listings. By developing a backup plan, you save yourself a lot of time and heartache, and you move on from disappointment much quicker.
In conclusion, winning a bidding war is more of an art than a science. But by following the tactics we’ve discussed, you will have an advantage over other bidders and be more likely to land your dream home. Be patient, strategic, and focused, and most of all, don’t let desperation get the better of you. The competition is fierce, but the feeling of owning your dream home is well worth the effort.