The housing market is a dynamic one. Sometimes it’s a buyer’s market, and other times it’s a seller’s market. Timing your decision to buy a home based on these trends is of course ideal, but not always realistic.
If you find yourself in the market to buy a new house when there is limited supply and heavy demand, you may very well end up competing with other buyers for the same home in a bidding war. Read below for tips to cleverly win a bidding war on a house you love.
1. Be prepared.
Buying a home is complicated and stressful enough, but throwing a bidding war into the mix can be overwhelming. Always work with a professional Atlanta Realtor for best results. Especially if it’s your first time buying a house, he or she can walk you through the best possible strategy for outbidding your competition. Because Realtors have more knowledge about market conditions, they can move more quickly and confidently than average buyers.
Secondly, ensure that you have been pre-approved for financing before making your first offer on a home. Consult with a lender to determine just how much house you can afford and have a loan pre-approval letter ready to send with your offer. In most multiple offer situations, a buyer who signals the intent to put down at least 20 percent of the purchase price is the best position to win a multiple offer battle.
2. Be flexible and accommodating.
Money is not the only incentive that buyers have for selling. Sometimes home sellers are in a hurry to move out, or they need several months to vacate the home. If that’s the case, be flexible with your closing and move-in dates. Some buyers will even allow sellers to stay in the home after the closing date while paying rent until they’re ready to move.
Along the same lines, find ways to accommodate your seller. Offer to deal with items that they don’t want to take with them to their next home like unwanted furniture or other items, and sellers might just choose your offer above the rest.
3. Make a “clean” offer.
If you really want this house, have as few stipulations as possible. If you want new flooring, don’t mention it, just plan to change it after. If the seller has a few inconvenient requests, just work around them. The easier you make it for the seller, the more likely you will get the house.
Something to also take into consideration is to make an offer with the right to request repairs instead of subject to a due diligence period. A due diligence period is often called “a free look” because the buyer can terminate for any reason. Sellers prefer a contract that is subject to repairs and financing only because they don’t want to take their homes off the market for two weeks without knowing the buyer has made a firm commitment.
4. Increase the earnest money.
Earnest money is usually about one to three percent of the entire purchase price of the home, and it acts as a deposit made by buyers once the offer is accepted. The closer your earnest money amount is to three percent, the stronger your offer will be.
Buying a home, especially in a competitive market, is a challenging task. Working with an experienced Realtor and preparing yourself with as much knowledge as possible is the best plan for winning a bidding war and securing the home of your dreams.
Contact the experts at Beacham & Company for more help securing the home of your dreams.
Image Courtesy of: Huffington Post
