Bidding wars can be ugly, nasty things - but with the right tactics, you can come out a winner without having to double your offer. Welcome to basic training - today, you'll learn how to navigate the obstacle course that is a real estate bidding war and come out on top. Put these three strategies to use and you'll easily win the home of your dreams.
Offer To Pay The Deposit In Cash
It's not usually wise to make a down payment in cash, but paying cash for the deposit is a brilliant strategy that will put you first in line for your new house. One major reason why homes don't sell is because the buyer didn't get approved for financing - and that inconveniences the seller. Paying your deposit in cash proves your reliability to the seller, and it means the seller gets paid faster.
Add A Personal Touch With A Letter
Want to get a completely unfair advantage over other buyers in your neighborhood? Make your offer personal by writing the sellers a heartfelt letter. Marketing professionals know that emotional experiences are highly persuasive, and a personalized hand-written letter shows that you care.
For maximum effect, do a quick Google search on the sellers and look for common threads. Do the sellers have a child in college? Talk to them about your college-aged son or daughter and what program they're taking - it may sound cliché, but a little bit of bonding really does go a long way.
"Escalate" The Situation With An Escalation Clause
When most buyers write up their formal offer, they simply name a price and that's it. But you can set yourself apart from other potential buyers by including an escalation clause in your offer.
An escalation clause is a piece of a real estate contract that increases your offer in the event that you get outbid. An escalation clause usually lists your original offer, the amount by which you're willing to beat other bids if you get outbid, and the maximum amount you're willing to offer in the event that there are multiple offers. Escalation clauses are usually best used when you know that there will be a one-day review of all offers or when you're anticipating multiple offers - otherwise it may compromise later negotiations.
Bidding wars aren't ideal, but they are a reality of the real estate market - especially in competitive areas where it's the norm to see multiple offers on a house. But with these tactics, you can outgun competing bidders and come out with the house you've always wanted. Contact your trusted real estate professional to learn more about navigating a bidding war and making a winning offer.