How to be Competitive in a Bidding War

The real estate market is HOT! Navarro, and Ellis Counties are experiencing some of the highest sales price averages we have seen in years, not only is this true for Navarro County but is also happening nationwide. Interest rates are at a historical low, so low that those how can are making quick moves to take advantage of them while they last. 

These historical stats are proof that it is a seller's market! Low inventory, great interest rates, and tons of ready and willing buyers! While this makes being a selling a home a walk in the park, the same thing cannot be said for all buyers right now. The market is extremely competitive! So we are going to give you some helpful tips to help your offer stand out, and get you on the path to purchasing your dream home. 

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The One of the most stressful situations in home buying occurs when other buyers are competing for the home you want. To make an offer on the perfect house only to find out you have entered a bidding war is certainly frustrating.

It doesn’t happen often, but if there is a shortage of homes for sale, or you are looking in a particularly sought-after area, it’s a possibility. It’s common to feel helpless as you wait for communications to come back through the agents involved, hoping for some good news.

To that end, I’ve put together some tips for how to make a multiple offer situation as comfortable and successful as possible for my buyers.

1. Pick a real estate agent who is well organized and an exceptional communicator. A lapse in communication could be interpreted as disinterest. Don’t get overlooked because your agent didn’t communicate with the seller’s agent in a timely manner.

2. Have your pre-approval letter or proof of funds in hand. You may have a great offer to submit, but if you can’t back it up with proof you are qualified to purchase the home the seller may just move on. 

3. Make a cash offer if you are able. If not, make as large a down payment as possible, and use a lender that communicates effectively with all parties.

4. Offer more than the asking price. Your agent should do a comparative market analysis to give you a good idea on the home value as soon as you decide to make an offer. If it’s not too out of line with the CMA or your budget, offer more than the asking price. 

5. Keep your offer clean and simple. Don’t ask for contingencies that aren’t necessary to closing the transaction.

Shorten the inspection period. Asking for a 5 to 7 day inspection period instead of the traditional 15 lets the seller know that you aren’t going to waste anyone’s time. 

6. Find a home inspector who has availability to schedule your inspection as soon as your offer is accepted.

7. Have your escrow deposit ready. Offer an escrow deposit that sends the message that you are serious about your offer and have the funds ready to turn in as soon as your offer is accepted. You may want to include a copy of your escrow check with your offer. Typically it is recommended that this amount is 1% of the asking price, if funds allow increasing this amount can also back up how serious you are and how important the property is to you. 

8. Offer flexibility with your closing date. Convey through your agent that you are willing adjust the closing date to suit the seller’s needs.

9. Include a personal letter with a family photo. Let the seller know who you are, what you like about the home, and that you intend to take good care of their former residence. Let them know what it is about the home that has already made it special to you.

10. Have your agent convey to the seller's agent that given a multiple offer situation, that you would like the opportunity to revise your offer. 

9. Be diplomatic with negotiations after your contract is signed. Remember that the seller has other interested parties to fall back on. If you turn ugly after the contract is signed, making additional demands or not following through with your promises, the seller may hand you back your deposit and work with someone else.

We have learned in 2020 that anything is possible, and there are no guarantees! But we believe that these tips are a great way to make your offer stand out, and potentially help you in purchasing the home of your dreams.