Getting into a bidding war for a house is a nightmare scenario for many homebuyers, and for good reason. Getting your finances in order, selling your own home or ending a rental agreement, and searching for the right house is already stressful enough. When you finally do find your dream home, it can be heartbreaking to lose it to another buyer. Bidding wars are an unfortunate reality of the real estate market. And, thanks to falling interest rates and an inventory shortage, competition has been even fiercer than usual in recent years. So if you plan on bidding for a house in the near future, you might be well-advised to anticipate a bidding war. Fortunately, there are several things you can do that will help you and your offer stand out in a bidding war.
#1: Make Bold Financial Moves when Bidding for a House
It should come as no surprise that, in a bidding war, money is (almost) everything. That’s why being upfront about your finances is one of the most impactful things you can do when bidding for a house. It’s always a good idea, for instance, to obtain a pre-approval letter from a reputable lender so the seller knows you’re financially capable of following through in your offer.
If you’re able, offering cash or raising your down payment offer are also wildly attractive to sellers. As is offering an appraisal gap. When it comes down to it, sellers are looking for a secure arrangement as much as buyers are. Keep that in mind, be as competitive as you can with your offer, and it’s a good first step toward winning the bidding war.
#2: Make Some Concessions for the Seller
While offering more money for a house will get you a long way, it’s also important to remember that there wouldn’t be a bidding war if other interested parties weren’t also offering more money. So, what else can you do to stand out when bidding for a house?
When it comes to the actual transactional process of purchasing a house, there are a few things you can do that will make the experience easier on the seller, and therefore much more appealing for them.
One of the best things you can do is to waive the home inspection. If you’re willing to forego the inspection, this can speed up the process significantly for the seller and minimizes the likelihood of renegotiations. Be aware, however, that this does come with a few risks. While it removes the risk of re-negotiations for the seller, it removes your negotiating power if there are serious issues with the house. On that note, going without an inspection means you could miss some hidden issues that may become major problems in a year or two.
#3: Bidding for a House? Move Fast
Again, it’s important to remember that when you’re bidding for a house there is another human on the other side of that deal. As anxious as you are to get into your new home, the seller may be just as motivated to get out of their current one. So anything that you can do to speed up the home buying process will help you stand out from the rest of the interested parties.
We already mentioned one means of doing this above (i.e. foregoing the home inspection) but another you can offer is flexibility on the closing date. Allowing the seller to determine the closing date, and then meeting them on that, will give you a major advantage in almost every bidding war scenario.
#4: Make Your Offer Personal
This is the piece of advice that buyers either enjoy or shy away from, but at the end of the day it’s always helpful to remind the home seller that you are another person as well. Particularly today, when corporations are buying up massive swathes of entire neighborhoods, putting a face to your offer may even help you beat out the private equity backed firm that routinely offers $50,000+ over asking price.
You can do this by writing a letter and sending some pictures of yourself and your family, if you have one. Introduce yourself and let the seller know how much you love the home. In today’s digital world, you may even be able to connect with the seller over social media. Just remember to be respectful of boundaries; taking a casual but professional approach is probably the best strategy in most cases.
#5: Have an Experienced Real Estate Agent in Your Corner
Last but not least, it’s always advisable to work with a local real estate agent when bidding for a house. Not only can your real estate agent offer additional advice for your unique situation, but they will also take a lot of the busy work out of your hands, allowing you to focus on the bigger picture. Knowing the local market, the housing trends, and the neighborhood can also give you a solid foundation from which to engage in a bidding war. After all, the more you know, the more intentional you can be with your strategies.
CENTURY 21 Bolte Real Estate Represents Both Buyers and Sellers in North Central Ohio
CENTURY 21 Bolte Real Estate has been serving home buyers and sellers in North Central Ohio for more than 80 years. We’re proud to be deeply involved in our communities and we’re passionate about helping you achieve your real estate goals. Whether you’re ready to start the search for your next home, or you’re a seller looking for an expert partner to help you navigate the process, we’re here to help. Connect with our team today to get started.
