Searching for a home can come with excitement and plenty of unseen situations whether you are a novice or a veteran buyer. Unexpected bidding wars can result in frustration and panic, and in today’s buyers-market, bidding wars have become a very common occurrence. Last year alone, 51% of buyers in the Washington, D.C. area engaged in a bidding war when attempting to secure the home of their dreams. Taking steps to understand the art of negotiation and preparing in advance with well thought out strong submissions can ensure you enter into the bidding game with a better than average chance at landing the house you want.
A strong introductory offer – They say you can’t win the game if you don’t get in it. Sellers that receive lowball offers regard them with little seriousness. It is suggested that when considering a first offer, the figure should be no less than 99% of the asking price. This certainly does not mean making offers that are out of your range, but it does mean that presenting the highest amount that you can sends the message that you are to be taken seriously. Another way of making sure you get the sellers interest is to increase the earnest money that you put down.
Remain flexible – Although the majority of people are usually eager to close a deal, some are not. Particularly in high-stakes bidding wars, it can be an extreme advantage to possess the quality of flexibility. Entertaining various options when it comes to inspections, leasing and financing can offer accommodating factors. A seller that is not quite ready to vacate can be presented with rental agreements that will definitely make your offer stand out above the rest.
Further negotiating tactics – In the event you are engaged with multiple buyers, there are ways to improve your chances of winning the hand. Waiving inspection contingencies or financing contingencies are options that can provide some extra leverage although they don’t come without some added risks to consider. Some of these strategies can increase your odds up to 23% that you will win the bid, but may not be a viable option for the lower income and questionable credit buyers. One final suggestion is to present the sellers with a cover letter. This has been proven to improve your chances by an additional 18% that you will win the bid over other offers.