In a housing market where demand is high and inventory is low, buyers may find themselves in a bidding war when trying to purchase a home. If you’re in this situation, it’s important to make your offer stand out so that the sellers will choose yours over the other offers. Here are tips on how to make your offer stand out in a bidding war.
Work with an experienced real estate agent so you have an edge
When it comes to buying a home, having an experienced real estate agent on your side is key. With their expertise and knowledge of the local market, they can provide invaluable guidance when negotiating. A real estate agent can offer insight into a property’s true value and help you get the best deal possible. By taking advantage of an experienced agent’s specialized skills, you stand to save in any transaction.
Go in with your highest and best offer
Making your highest and best offer can be intimidating, especially when you’re caught in a bidding war. However, if you go in with your maximum bid right away, you’ll have a better chance of success than if you start low and work your way up. It’s a strong signal to the seller that you are serious about purchasing the house. Additionally, it can put pressure on other interested parties who may not have the financial ability to match your bid. Don’t let fear of being rejected stop you from getting the home of your dreams. Go in with your highest and best offer and secure it before someone else does!
Put down a strong earnest money deposit
If you’re serious about purchasing a house, putting down a strong earnest money deposit is a great way to demonstrate that commitment. This money, typically ranging from 1-20% of the purchase price (varies by region), will go towards the total cost once the offer is accepted. These funds serve as the buyer’s guarantee that they will proceed with the agreement once all terms are met. It’s an easy way to show your seriousness about buying a home and gives both parties peace of mind throughout the process of making an offer.
Get fully approved for a mortgage
Getting approved for a mortgage before house hunting is an important step in a competitive home-buying market. By getting approved, you can rest assured that you can secure a loan to purchase the house of your dreams and the seller will know they have a serious buyer. Additionally, being approved ensures that a seller is more likely to accept an offer from you. The seller will know that you are both motivated and qualified to finance the purchase, increasing your chances of having your offer accepted. If you haven’t gotten approved yet, it’s not too late.
Take proactive steps today and contact your lender or local bank for assistance. If you are fully approved, the appraisal for the property is the only financial element that may be in play. This strongly improves your chances of winning the multiple bid.
Keep the number of contingencies to a minimum
When entering a bidding war, it is important to remember that less is more. Crafting an offer that limits contingencies significantly increases the strength of your bid. Limiting contingencies gives the seller confidence in your bid and shows that you are serious about purchasing their home. In addition, it may actually decrease the amount of money you will spend because sellers often increase their asking price when they see numerous contingencies attached to an offer. Keeping contingencies to a minimum will help set your offer apart from others in a competitive situation, giving you higher chances of success while also lowering costs and risks.
If you want to win a bidding war on a house, follow these tips to give you an edge. Work with an experienced real estate agent, go in with your highest and best offer from the start, put down a strong earnest money deposit, get approved for financing, and keep the number of contingencies to a minimum in your offer. With these steps, you’ll be in a better position to purchase the home you want.
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Richard has extensive experience in all aspects of buying and selling residential property. He has sold more than 400 homes and well over $100 million in residential real estate. There’s no need to guess. Get expert advice that will allow you to buy and sell with confidence and ease.
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