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Today we're going to talk about how to approach a bidding war if you're a buyer. Usually a bidding war starts because the home itself is a good investment. The home could also be in a good neighborhood, or near a school that everyone is trying to get into. Basically, it's a result of supply and demand.
If you find yourself in a bidding war, how can you win? The best thing to do is hire an agent who knows the pulse of the local market. They are usually connected with other agents, other agents trust them, and they know a good lending company.
Another strategy for winning a bidding war is making a cash offer, or offering a large down payment. You could also offer a few thousand over list price, and guarantee any appraisal gap coverage - meaning, if you offer $3,000 over list price and it doesn't appraise, you will pay up to $3,000 over the appraised value, not to exceed the contract price. You'd be surprised at how often that works, and the home does appraise.
Ultimately, a home is in high demand because it's a great investment. You don't want to buy a home that's been on the market for three months and there's no demand for it, because when it's your turn to sell, you might have a problem.
If you have any other questions about today's topic, or about real estate in general, please give me a call or send me an email. I'd love to hear from you.
