Bidding War Mistakes: 3 Big Ones that Thunder Bay Buyers are Making!
If you are a home buyer in Thunder Bay, I am sure you know just how competitive the current real estate market is. Interest rates, although rising, are still at historically low prices, and a shortage of inventory is leading to most homes selling in frustrating multiple offer situations. If you are beginning to feel defeated, you are not alone!
In this blog post, I am going to outline the 3 biggest bidding war mistakes that home buyers are making, so that you can avoid making the same mistakes that they are.
Be sure to read to the very end where I will share 3 quick bonus tips that can help your offer stand out amongst the competition.
Expecting a Price Reduction after your Home Inspection
If you’ve done a home inspection prior to submitting your offer, and are planning on asking for a price reduction after your offer is accepted, you will be very disappointed. Sellers generally find requests for price reductions based on small repairs very tedious, and in this market, they most likely have a backup offer in place anyways.
Failing to Address the Seller’s Pain Points
Does the Seller want a quick close, or a longer close on a specific date? Do they need a suitable accommodation clause? Maybe they have some big things that they’d rather not move. Overlooking or underestimating what is important to the Seller can be a VERY big mistake.
Focusing too much on the List Price
Focusing on the List price and taking advice from family and friends when deciding how much to offer can be a huge mistake. While your family and friends are very well intentioned, they really aren’t familiar with current market conditions, and very often have been out of touch with market conditions for quite some time. Focusing on the list price and then scaling your offer from there is also a major mistake, as is scaling based on the number of competing offers. Listing prices are irrelevant in a strong Seller’s Market, and many Listings are incorrectly priced.
If you want your offer to stand out amongst the competition, there are a few things that you CAN do.
Pro Tip #1
Increase the Size of your Deposit
First of all, consider increasing your deposit to show that you really are in a good financial position- Sellers take larger deposits more seriously, particularly in higher price ranges.
Pro Tip #2
Write a Letter
You can also consider writing a letter to accompany your offer to the Seller. Include your employment and preapproval details in the letter. Sellers like to know a bit about the buyers whose offers they are considering.
Pro Tip #3
Don’t Offend the Seller
Finally, right from the get go, when you are first viewing homes, ALWAYS be complementary of the home during your viewing. It is best practice to assume that you may be on video during your viewing, and you don’t want to offend the Seller early on in the process!
If you are a buyer in Thunder Bay and you found this information helpful, you will definitely want to read my next post- 10 MUST ASK questions before buying a house in Thunder Bay.
You can’t ask what you don’t know, and the time to find out that you missed asking a pertinent question is NOT after you’ve bought the house.