When my husband and I were in the process of having plans drawn up for our new home, we found our dream home. Down to the very last detail, this house is every single thing we’ve ever dreamed of owning in our adult lives. Nothing was going to stop us from owning this house; and it didn’t. We have been here a year and-a-half now. However, many people find that just when they think that they’ve secured their new home, someone else outbids them. Low rates, a lack of available homes and increasing prices are making the market a little crazy in some areas of the country, and bidding wars for homes are becoming more and more common. Want to win yours? We have some expert advice for you to follow.
Sometimes the winning bid in a bidding war is the one most appreciated by the seller. Someone might ask that they have a quick close. Someone else might say, “I’ll close when you are ready,” and others might state that they’d like to close quickly but are willing to rent the house to the seller for an addition 30-days following closing until they have time to move and find a new home. It all depends on the buyer, but flexibility is sometimes the difference.
Keep your contingencies simple
“And then we want the washer and the dryer, and the left side of the golf cart, the painter to come in and paint the trim black two weeks before closing and we’d like to see if we can add yet another contingency to keep the cat, too,” versus, “Contingent upon a 30-day closing,” is probably not going to win. Even if someone bids higher than you, you could still get the house if your contingencies are reasonable and short.
Write a letter
Agents recommend that you send a written letter to the seller of a home, and include photos of your kids, pets and yourself, explaining to them why you want to live there. Your touching story of just giving birth to twins and having all that space for your four kids to run around and explore, play and enjoy while they grow up in a home that feels so much like a family home, and so much like a safe haven might just be the story sellers need to choose you in a bidding war.
Add an Escalation clause
This is quite simple and it saves you a bit of time. Let’s say that the house you love costs $450,000 and you know there will be multiple offers. Come in at full asking and then add an escalation clause that states you’re willing to go X dollars over that price up to a limit. For example, offer the full $450,000 and then add a clause stating you’re willing to go $1,000 over any higher bid up to $461,000. This means you’re not losing wars left and right.
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