How to win
Securing the house when in a bidding war takes knowledge, commitment, preparedness and guts. Sometimes the differences between the top offers that have been presented to a Seller are very slight. Frequently there is no clear-cut winner and the Seller is forced to make a judgment call. Only one Buyer gets the house, stack the cards in your favour to have that Buyer be you.
Here are the key ingredients for success:
- Try to meet the Sellers beforehand. Sellers like to sell to people they have met and feel would be good buyers for their home.
- Know the market so that you are in a position to bid high but not overpay.
- Bid high as you can. Sellers almost always sell to the highest offer.
- Bid high, at the first round. You are not guaranteed to get an opportunity to improve your offer.
- Huge deposit. Certified cheque or Bank Draft. Huge deposits greatly impress Sellers.
- Consider inserting a clause in offer that states should you (the Buyer) default on the purchase and not close the transaction, the deposit will be immediately released to the Seller. Your lawyer might not like this but Sellers love it.
- Possession. Accommodate the Seller’s requested possession date. Even better, offer a flexible possession date within specific dates. This gives the Seller the opportunity to set his/her exact preferred date.
- Few, if any conditions. Building Inspection. Prudent Buyers want to have a house inspected before submitting an offer. This is understandable. However, you have to balance your need to have a building inspection with the fact that winners in multiple offers usually have firm unconditional offers. Maybe have it inspected before you submit your offer? Financing. Get your financing in place before you submit an offer. Talk to your Mortgage Broker, your Bank Manager or existing Mortgagee before you get to the offer submission stage on a house so you know exactly what you can rely upon them to provide.
- Prove your ability to close the transaction. Perhaps impress the Seller with your career or have a letter from your bank stating you are in a position to close the transaction.
- Don’t ask for things in the sale that the Seller has not already included in the sale.
- Maybe write a note to include with the offer about why you want the house.
- Keep yourself available when offers are being presented. Totally, 100% available for last minute discussions, negotiations or clarifications.
- Have faith and trust in your agent. If you don’t trust your agent by the time you are into a multiple offer scenario, you are dealing with the wrong agent. The experience and counsel a trusted agent can and should provide when in multiple offers can absolutely win you the house. Your agent should provide you with insight and informed options. Consider them and make the most aggressive choice you can.
One comforting reality is that bidding wars usually take place only on good properties. Paying top dollar for a house today may prove to be a bargain in hindsight tomorrow. Today’s multiple offer winner buyer may also well be putting themselves in a Seller’s multiple offer scenario when selling in the future. Nothing is more gratifying.