4 Tips to Win a Bidding War
South Florida’s real estate market continues to be active despite limited inventory of homes for sale at certain price points, a decelerating pace of appreciation and increased days on market for some listings. Limited inventory at certain price points may lead to competition among home buyers and potential multi-bid scenarios. Still, buyers can beat the competition without going over their budget. With these tips from the South Florida real estate professionals at Stein Posner, you can win a bidding war and capture your dream home.
1. Give Best and Final Offer First
Sellers and listing agents will pay closer attention to more attractive offers, in respect to both price and terms. Buyers should clearly understand how much they can afford to spend on a house and form their offer accordingly, with the help of a professional. Consider adding an escalation clause to the initial offer to prevent being outbid. An escalation clause is an agreement that states the buyer is willing to increase their offer in incremental amounts up to a maximum limit if other offers surpass their initial bid.
2. Allow for Shorter or Longer Closings
Finding out a seller’s motivations for selling their house is beneficial because buyers will have a better grasp on what the seller wants when closing the sale. Sellers who already have another house to move into or have vacated the property may choose buyers who offer a shorter closing period. For instance, a buyer could expedite the transaction by shortening the time frames for inspection and financing approval.
In other cases, some sellers have yet to move out of their listed homes while still looking for a new house. These sellers will favor buyers who can offer a longer closing time period, providing more time to find a new home. Buyers can either push back the closing date, or potentially agree to rent the home to the sellers after the purchase until they are ready to move out.
3. Appeal to Sellers’ Hearts
Buyers should write admiring letters about listed homes to home sellers. These letters should include: reasons the buyer would love to buy the house, ways the house will fit into their own personal lives, and any pictures of the buyer and his family. Sellers often have a deep emotional attachment to the house they’re selling, so they want to know the house will be in good hands. Hence, sellers often favor buyers they can visualize living in and taking care of their listed home.
4. Do Not Give Up
Even if the buyer is outbid or his offer is rejected in favor of another offer — the buyer should not stop fighting, and the real estate professional should keep in contact with the seller. The highest offer is not always the best one. Offers that significantly surpass the asking price often cancel. If the initial deal falls apart, sellers will review other offers. In most cases, they consider offers from buyers that have shown continued interest.
The home buying process can be highly competitive and stressful, especially when there is a shortage. In this type of market, home buyers may have to go through bidding wars and fight for the house they want. If you’re looking to purchase a home in South Florida, turn to your real estate family at Stein Posner. Our expert team of South Florida real estate professionals can assist you throughout the home buying journey and help you obtain your dream home. Call us today.