Bidding wars are fun to watch, but when you are a participant? That is a different story.
Real estate bidding wars can be brutal especially when it is a property that a lot of people want and that you must have! This usually results in higher bids since many people want to become the new owner.
Luckily, money is not the only factor that drives real estate bidding wars. You could be the highest bidder and still not lay claim to the property you were hoping for. Following strategies like pre-approval letters, a fixed closing guarantee, and more can give you an edge over your competitors.
Here is how you can win a bidding war without being the highest bidder.
1. Have a Pre-Approved Letter in Hand
The first step of looking for a house? Getting pre-approved for a mortgage. A pre-approval letter displays the exact amount a bank or mortgage companies are willing to lend you.
Sellers are known to overlook bids from people who do not have pre-approval letters. So, make sure you get verified for one. This will show sellers that you are a serious buyer with the ability to pay.
2. Waive/Negotiate the Contingencies
In a real estate bidding war, having too many contingencies can work against you. While inspections are extremely important, make sure you do not ask for too many contingencies.
However, waiving or negotiating contingencies can open you up to a significant amount of risk. Make sure to take this into account before waiving contingencies completely.
3. A Flexible Timeline is the Way to Go
Why exactly did the seller put the house on the market? Find their motivation. Once you do that, tighten up your inspection timeframe and offer a closing date according to the needs of the seller.
Depending on whether the house is available for immediate possession, or the seller needs a few weeks to sort things out, matching your timelines to match the seller’s needs can put you on top of the list even if you don’t bid the highest.
4. Make an All-Cash Offer
Buying real estate can be a tough sport! Financing issues can suddenly crop up at the end spoiling days of negotiations and inspections. An all-cash offer shows the seller they will not have any financing issues with you.
A cash deal saves time for everyone involved and guarantees a quicker closing date. Now, making all cash offers is certainly not an option for everyone, but you can sweeten the deal by offering a larger non-refundable deposit. This shows you are very serious and can help you win over a larger total price bid, that could cancel anytime and not lose their deposit.
All About the Strategy
Winning a real estate bidding war is less about the amount of money you can offer and more about how soon you can offer it, and the specific details. You do not have to bid the highest to own the house you absolutely adore. If you have a strategy to follow, you will have a good chance of winning. Make sure that you leverage yourself with excellent real estate representation in Las Vegas to ensure that you have the best chances of getting your next property.