With so-called bidding wars becoming the new normal, here’s what buyers need to know
Buying a house is “business,” but it is also very personal, and people are people. Basically, sellers want to pass on the property to someone they like.
The best thing to do after the disappointment of finding yourself in a bidding war is to take a step back and realize: If someone else likes the house, you’re not alone. It is a good investment.
The next thing is to think about how important the house is to you. Is it worth spending another $25, $25,000, $50,000 or whatever the cost to outbid all others? Can you financially add that much to your offer? Somehow, we always spend more than we’d like, but most often, the financial stretch is a good thing in the long run. But you, the buyer, must be comfortable with the figure—that the reach is worth it. The number you offer most often is most important, but not always. Contingencies are key; the fewer, the better.
The more you can find out about the seller’s preferences, the better, too. Does the seller want to close sooner rather than later? If you need a mortgage contingency, the more you can put down, the better. The seller will feel a comfort level that you can afford it and won’t back out of the deal in the works. You will want to have a building inspection, but if you feel the property is in good condition, or if you plan to tear it down, you might still do the inspection, but for your information purposes only, rather than as a contingency.
Buying a house is “business,” but it is also very personal, and people are people. Basically, sellers want to pass on the property to someone they like. So be prepared to explain to the seller what it is about their home that you love. It may not work, but it is worth a try. Consider that this will be your home—where you raise your family, where memories will be made. Give it your best shot, and good luck!