Tips for Avoiding a Bidding War For Your Buyers

The housing market is coming back in full swing, and with it demand is skyrocketing, home prices are going up, and both buyers and sellers are getting more excited to enter into a hot period for real estate. In many parts of the country, home prices are now exceeding their pre-housing crisis and recession values. Real estate agency Redfin reported in May that 61% of offers written by their agents received competition from other buyers. Sealing the deal for clients isn’t always a sure thing, but there are certain steps to take and considerations to account for before putting in an offer and taking the steps to close on a home.

Before even putting in an offer, real estate agents should consult with their clients to ensure that the offer they’re placing is the best and final offer possible. In a competitive market, there’s no room for deals that leave sellers able to put multiple offers ahead of what your clients are submitting from the outset. Instead, it’s best to start from a competitive position by submitting a fair, reasonable, and best offer accounting for the recent sale prices for similar homes within the same location.

Step-1_Pre-Approval

Next, it’s critical to have clients pre-approved for a home loan before putting submitting the offer. Sending a letter of pre-approval along with the official offer shows the seller that the client is serious and able to afford the amount they’re offering. This guarantees a smoother transaction and a faster sale than if the client hasn’t yet been screened for approval by a lender.

 

Within the offer, it’s also important to consider scaling back on additional requests or contingencies. For example, increasing the length of closing time is sure to irritate the seller, particularly in regions where the market is hot. While an offer consisting of a contingency sale for the buyer’s current home to purchase the property in question might be nice, extending closing time for a length of more than a month could definitely result in the buyer’s offer being rejected in favor of offers for a faster, easier sale. Other things to consider removing from an offer are requests for modifications or changes to the house. For a quick sale, liquid capital and and no-issues buyers are typically at the top of the list when it comes to the seller choosing an offer.
Finally, while money talks, it isn’t necessarily everything. Focusing on the needs of the seller can be equally beneficial for potential buyers. For example, if the buyer is willing to aid the seller in the sale of the house in ways that are important to their personal circumstances, the seller may be swayed to choose the person making the offer who they like more on a personal level. This might mean helping the seller with moving out of their old home, disposing of old items they may have difficulty moving, or waiting to match the seller’s ideal closing time to close on the home.

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