How do buyers prepare when they find themselves for the purchase of a home, including a multiple-offer bidding war? What focused negotiation strategies are more likely to find success?
Most transactions will be straightforward when a single offer is presented and sellers exercise their right to counter and work with that offer to completion. Sellers however also love multiple-offer situations: bidding wars may send buyers away – unwilling to participate.
Buyers need to educate themselves on straightforward strategies and empowering options that offer the best opportunities and a fighting chance to realize the home of their dreams in any potential transaction.
Here are some strategies:
Prepare yourself mentally and emotionally: focus on what you have, need and are looking to achieve.
Property prices do as the norm, although not necessarily, reflect market value; some may be set as teasers. Your REALTOR® will determine the properties market value and run a CMA (Comparative Market Analysis), to identify comparable neighborhood properties that have sold over a specified period of time. A multiple-offer situation may drive the eventual selling price up in a bidding war.
Sellers typically shy away from offers based on the sale of buyer’s properties, so consider selling your home first before looking for properties to buy. This scenario is stressful for both sellers and buyers; lessens a favourable outcome and buyer’s chances especially if you come up against other competing offers not dependent upon the sale of property.
Approach your bank or mortgage agent to pre-qualify you and get your financing in order before you start looking at properties. You now understand the parameters of your home search relative to what you can afford.
When you find your perfect home, if the seller has not done a pre-inspection, have a contractor or property inspector go in to the property right away. In this way you are forewarned as to the home’s condition.
Sometimes an issue can be used as leverage, a bargaining tool in negotiations; however in some situations buyers may decide to forgo the inspection and take responsibility for the renovation of any issues. Every situation is different. An inspection is always recommended.
Be prepared to present an offer to purchase as soon as you can.
Ask your REALTOR to determine from the Seller REALTOR® what the level of interest is like and whether or when any offers are going to be presented.
Bring your best price. Your REALTOR® will be fully versed with what you can comfortably afford. In a bidding war there may not be much room for negotiation. The seller has the right to counter or discard any of the offers they feel are not going to fulfill their wish list.
Come prepared with a bank draft or certified cheque and a strong deposit. If there are two offers at the same price, sellers might opt for the one with the greater deposit – the perception of a serious candidate.
A good REALTOR® understands the importance of having an open, cordial working relationship and clear communication with other REALTORS® who will work together to find the best and highest resolution for their clients and the transaction at hand.
Most sellers want to know their home is going to the family who will love the house as they have. Your REALTOR® may speak of how your family loves the house.
Understanding the value and worth of the property to you and your family will give you confidence no matter how many people are presenting. Take all the necessary steps to inform and prepare yourself, and arm yourself with a firm trust in your REALTOR®. Any doubts will be allayed, and you can make your best effort to realize the home of your dreams.