Bidding War: Keep your Eye on the Prize
Found your dream house? They don’t call it a bidding war for no reason. Follow these tips and arm yourself with the right strategy before heading on to the property battlefield.
Excited about this property? It’s all too easy to let the stress of a bidding war curb your enthusiasm. Now is not the time to be aloof. Show the seller how much this property means to you. It most likely holds treasured memories of important milestones for the seller. Expressing a genuine passion for the house can go a long way– sellers often want to feel that their humble abode is going to the right candidate. Building a rapport is essential. Make it personal.
There’s always the temptation to undercut the asking price. The seller may accept or meet you halfway. The important thing is to be informed before playing your cards. Ask your estate agent to relay back to you at frequent intervals any further developments on the sale, so you’re always prepared for the possibility of being outbid and position to counter-offer.
But don’t rest on your thoughts. Actively seek information and updates, sitting back and waiting won’t keep the pressure on the estate agent. Document your bid. A phone call is fine but back it up with an email. This means that documented, dated evidence of your bid exists and can be referred to when bidding back and forth with another potential buyer.
Show that you’re serious and don’t be afraid to ask questions. Make sure you know exactly what you’re up against and be prepared to push for details
Never Undersell Yourself
Figure out your unique selling point and use it. Make sure the estate agent know what sets you apart from the other potential buyer. Perhaps you have a better credit rating? Provide evidence. You may have financing already secured and could be a safer bet for the seller.
Consult a solicitor who is readily available to work on terms of sale contracts so the buyer knows that you are serious and prepared. Show that you’re not a risk and make sure you already have a pre-approved loan, this is essential. Prove your credentials, don’t expect them to go digging. In this instance, it actually pays to lay all your cards on the table and show why you’re the best choice.
Don’t insult the homeowner by going severely below asking rate. Studies have shown that an initial offer is often considered more seriously than subsequent bids. Get your offer in as soon as possible. If you do want to offer a lower price, go slightly under and perhaps think about adding an escalation clause – the price you’re willing to go to if more bids come in. Have the property inspected – this should give you a better idea of how plans for future expansion would work. Sellers may favour this over an offer that is conditional subject to inspection.
Do your homework and get to know ins and outs of the property. The better informed you are, the better a position you’re in to win the war.
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