Low inventory and high demand has increased the frequency of multiple offers. Homes that are new to the market are being sold quickly with many receiving multiple bids. Even homes that have been on the market for a few months are receiving multiple offers.
How do buyers and sellers manage the process when thrust into the arena of multiple bids and bidding wars? For sellers, the best advice is to prepare and discuss with your Realtor how you wish to handle multiple offers should they occur.
For buyers, handling the process astutely may make the difference between being the winning bidder or losing the house to someone else. Here are a few important things to consider:
1. Be realistic as to the price you offer. Low ball offers generally only slow things down and as the bidding heats up may also predisposition the seller to opt for another buyer.
2. Get preapproved and offer proof of funds for a cash offer– the seller will be more secure in accepting your terms if they know the cash is readily available.
3. Pick a “walk away number”. It should be a range, and it’s best to do this before you start bidding. Your range should be modified (up or down) as you receive more information on the property. Finally, be sure to ask yourself and your partner, “if we lose the house, will we regret not going higher?”
4 Be flexible as to terms. This is something to talk over with your realtor. There are situations where timing can be more important to a seller than a higher price. We recently had a seller who wanted a signed contract by a certain date – the winning bidder was not the highest bidder but did fulfill the seller’s requirement.
5. Once you select the property you want to buy, don’t dawdle. Make your offer and counter quickly. As more time passes, you are opening the door to other bidders. Heed the advice of your Realtor, she/he knows what’s happening behind the scenes.
6. Remember, the agent handling the negotiations is a New York State Licensed Realtor. He/she is bound by ethics and state licensing laws to treat all parties honestly and to submit offers and counter offers promptly. You should trust what you are being told.
When there are multiple bids on a property, the challenge falls on all the parties to the transaction to treat each other fairly. But ultimately, the seller calls the shots. Remember, when a seller is more comfortable with a buyer because of terms, price, circumstance or because they were first, they will get the house!