Best Ways To Win A Bidding War In Todays Market

Today’s real estate market is more competitive than ever. COVID has led to high buyer demand with fewer homeowners wanting to sell. Learning the ins and outs of the homebuying process can help you to gain an edge. It’s wise to read up on any tips and tricks you can put to good use. One of the most crucial things to understand is how to increase the chances of your bid being the most desirable. The following tips should help you out. Here are some of the best ways to win a bidding war in today’s market.

Be Realistic About What You Can Afford

When browsing homes for sale in Dallas, you need to know your budget. This will ensure you focus your time and energy only on the houses that fit within your criteria. Knowing how much you can afford will also make the process less stressful and emotional. You don’t want to fall in love with something you ultimately can’t afford. A mortgage calculator can help you determine your budget. Stand firm and walk away from properties that would overextend you.

Get Pre-Approval

A pre-approval letter from a lender can go far when it comes to making your offer more appealing. You’re a sure bet when sellers know you have the funds to make a purchase. It can be even more impressive to obtain pre-approval for a specific property you wish to bid on.

Have a High Downpayment or Earnest Money

Having more money upfront shows sellers that you’re serious about your bid. Sometimes a bidding war makes the purchase price higher than a property’s appraised value. This is when a larger downpayment can really make a difference. Earnest money is a deposit that’s made with your offer to hold a property. Typically, this amount is around one percent of the selling price. Offering between 10 and 20 percent earnest money would be ideal.

Offer More Money

Going higher on your bid might seal the deal. Even a few thousand dollars could make the difference between acceptance and rejection. Be aware that you may need to cover anything above the appraisal value on your own, as lenders typically won’t give you anything above this price.

Be Ready to Move

If there are multiple offers on a property, you’ll need to take every step possible to move quickly. Your agent can help expedite the process by preparing multiple contracts in advance. An escalation clause that allows your offer to be increased incrementally in the event that your initial offer is matched by another interested buyer. Another tip is to let the buyer know you’re open to going straight to the home inspection.

Show That You’re Flexible

Being willing to meet a seller’s terms and show flexibility will make you an appealing buyer. For example, the seller may need to remain in the home until they’re able to close on their new home. If you can accommodate their wishes, they’re more likely to work with you.

Keep these tips in mind when the market is tight. They can give you the edge needed to win a bidding war and move into your dream home.