Bidding wars are increasingly common in today’s residential real estate market. This is the case not just in LA or Southern California, but nationwide. The New York Times recently published an article with tips on How to Win a Bidding War.
While every situation is different, of course, the article offers generally good advice. As the NYT suggests, you must come in with a pre-approval (or at a minimum a pre-qualification) from a lender when you submit an offer. You will also need to demonstrate that you have the down payment and funds to close escrow, ideally in the form of bank statements to be submitted with your offer.
I also encourage you to work with a real estate agent and an experienced mortgage broker with whom you feel comfortable. Having professionals on your team not only takes pressure off yourself to deal directly with the seller’s agent, but also adds legitimacy to your offer. This is crucial in a bidding war when the last thing you want is for the seller to overlook your offer because they don’t take you seriously.
Additionally, multiple offer situations (bidding wars) are not the time to try to get a bargain. If you are serious about purchasing this home and a number of other would-be buyers are serious about it too, be prepared to start at, near, or above asking price. Certainly, some homes are overpriced and do not command the asking price, but when there are multiple offers, the asking price or fair price in your opinion becomes less important than “playing ball” with the negotiation process.
Finally, just as I (and the whole Dwell Well team) approach real estate with a personal touch, I often encourage clients to include a personal note regarding their household as a way to introduce themselves to the sellers. While the personal connection is unlikely to persuade a seller to accept an offer significantly below that of other bidders, there is no harm in trying to get an edge any way you can. On my end, I try to establish a rapport with the listing agent to extend that personal connection even further.
Ready to throw your hat into the ring? Contact me and we will come up with a strategy and get you packing for your move!