Bidding wars have become commonplace in this seller’s market thanks to low inventory and fierce competition. The National Association of REALTORS®’ most recent report found that nationwide, homes are receiving an average of 4.8 offers per sale, with California seeing an average of 5 or more. The same report shows that the average buyer made two offers before getting their third offer accepted. Other than retaining a knowledgeable seasoned Realtor, which is our number one tip for buyers, here are a few other things you can do to improve your chances of winning a bidding war.
- Offer Over Asking
As Bankrate explains: “Simply put, being willing to pay more money than other buyers is one of the best ways to get your offer accepted. You may not have to increase it by a lot and it’ll depend on the area and other factors , so look to your real estate agent for guidance.” Just make sure your offer still falls within your budget.
- Put Down a Larger Earnest Money Deposit
An earnest money deposit is a check you write to accompany your offer. If your offer is accepted, this money goes toward your home purchase. NerdWallet says: “A typical earnest money deposit is 1% to 2% of the home’s purchase price, but the amount varies by location. A higher earnest money deposit may catch a seller’s attention in a hot housing market.”
- Secure a Higher Down Payment
The biggest benefit of a higher down payment is that you won’t have to finance as much. But as an added bonus, if other buyers put less down, it could help your offer stand out.
- Make Non-Financial Moves
Money is not the only motivator for sellers. Non-financial tactics can help set you apart from other buyers, including accepting less contingencies, offering a pre-approval letter, and being flexible with the closing time and appraisal requirements.
The best way to win a bidding war is to partner with a seasoned real estate professional who will take all the above strategies into account and help you land the home of your dreams. To begin your home buying journey, contact Gary today, your 21 year seasoned Realtor.
Source: Keeping Current Matters