Buying a home can be a stressful and challenging process, especially in a competitive real estate market. Bidding wars have become increasingly common in many areas, leaving buyers scrambling to outbid each other and secure their dream home.
In this article, we’ll explore ten strategies for winning a bidding war and increasing your chances of buying the home you want.
- Get Pre-Approved for a Mortgage: Get pre-approved for your loan before you start house hunting. This will give you a clear understanding of your budget and make you a more attractive buyer to sellers. Your GayRealEstate.com agent is a great way to find a referral to a LGBTQ+ / LGBTQ+ friendly Mortgage Lender.
- Work with a Skilled Real Estate Agent: A skilled realtor can provide valuable insight into the local market and help you navigate the bidding war process if you’re purchasing a property at waterfront communities.
- Offer More Than the Asking Price: In a bidding war, you’ll likely need to offer more than the asking price to stand out from other buyers. However, be careful not to overextend yourself financially, and stick to your budget.
- Include an Escalation Clause in Your Offer: An escalation clause allows your offer to automatically increase if another buyer outbids you. For instance your offer can be written at or above the purchase price, with an “escalation provision” that states “the purchase price is xxx or $1,000.00 above the highest offer, up to xxx. This can help you stay competitive without constantly having to revise your offer.
- Be Flexible on Closing Dates and Contingencies: The sellers may be more inclined to accept an offer with flexible closing dates or fewer contingencies, such as a home inspection or appraisal. Consider making concessions to make your offer more attractive to the seller.
- Write a Personal Letter to the Seller: A personal letter to the seller can help you stand out and create a connection with the seller. Share your story and explain why you love the home and why it’s the perfect fit for you.
- Offer a Large Earnest Money Deposit: A large earnest money deposit can show the seller that you’re serious about buying the home and can give them confidence in your ability to close the deal.
- Waive Unnecessary Contingencies: Consider waiving contingencies that aren’t necessary, such as a radon test, etc., to make your offer more attractive to the seller.
- Stay Calm and Focused: Bidding wars can be emotional and stressful, but it’s important to stay calm and focused. Stick to your budget and don’t let your emotions drive you to make an offer you can’t afford.
- Be Prepared to Walk Away: Finally, be prepared to walk away if the bidding war becomes too intense or the price goes beyond your budget. There will always be other homes on the market, and it’s better to wait for the right one than to overpay for a home you can’t afford.
This is an important one – after selling homes for over 35 years, and buying over 50 properties myself, I can tell you without reservation the home you lose will result in a home that beats it in almost every case. There have been so many times I or a client have been crushed after losing a deal, and ultimately saying “I’m so glad that deal fell apart!”
With the right strategy and mindset, you can navigate the home buying battlefield and come out on top.
Jeff Hammerberg is a distinguished entrepreneur and broker, and the visionary founder of GayRealEstate.com. For over 25 years, he has been a prolific writer, coach, and author who has been instrumental in advancing the cause of fair, honest, and equitable representation for all members of the LGBTQ+ community in real estate matters. GayRealEstate.com, which he established, is the largest and longest-running gay real estate agent referral service in the nation, boasting over 3500 LGBTQ+ realtors who operate in cities across the United States, Canada and Mexico. His commitment to promoting inclusivity and accessibility in real estate has earned him a reputation as a passionate advocate for the LGBTQ+ community.
