In Toronto, bidding wars are the norm. It’s not uncommon for a house to have 5 or more people all competing for the same house. That means that people often walk away on the losing end of a bidding war. If you’ve lost out before, or if you’re thinking about buying a house in this competitive real estate market, then you might want to check out these strategies that are likely to give you a bit of an edge over the others, and hopefully, help you win a bidding war:
It’s Easy to Win.
Ok, so obviously the easiest way to win a bidding war is just to offer the more money than everyone else. If you really want to buy that $800,000 two-story character home in Bloor West Village, and you offer $200,000 over asking, you’ll probably get it. But you’ll be overpaying, which can cause all kinds of problems.
But, let’s assume that you’re not going to overpay like that, and that someone else isn’t going to come in and do it either. Let’s assume that there’s a few other offers, all offering around thee same amount of money for the house. How can you make your offer look it’s best and stick out from the crowd, and most importantly, win a bidding war?
Is your offer conditional on financing, a home inspection, and the sale of your own home? Your offer won’t look very good. You better believe that if another offer has none of those clauses, and a similar offer price, the seller is going to go for the one with the least amount of hassle; AKA, the one with the least amount of clauses. While removing a home inspection clause might seem crazy to some, there’s certainly a few things we can do to make it seem less risky.
Have Your Deposit Cheque With Your Offer
Bringing a cheque for the deposit shows the seller that you’re really serious about buying their house. Why? It means that if you’ve given them a deposit, and your offer is accepted, and you try to back out later, you’ll lose your deposit.
Be There in Person, Not Just in Spirit
If you’re actually there, you’ll be able to work with your real estate agent right away to make any revisions to your offer. Seller wants you to remove something? Or wants you to increase the price a little? You’ll be able to make those changes right away if you’re right there with your agent.
Instead of choosing a closing date, you can leave it blank. Letting the seller choose their own closing date instead of picking your own can make your offer look a little better than the others.
Choosing an Experienced Agent with a Really Really Good Reputation.
Going with an experienced real estate agent, instead of your mother’s friend’s son that just finished his OREA course, is a really good idea and can definitely give you an edge. Why? An experienced Toronto real estate agent is likely to have already have had experience with bidding wars, and if they have a good reputation and other agent’s like them (especially the one you’re presenting the offer to), things are much more likely to go your way if everyone can play nice together.
And if all Else Fails…
…then next time, you can always make a bully offer. What is it? It’s when you bring the seller an offer before the offer presentation night. The only downside here, is that you’ll probably have to overpay; otherwise, the seller is likely to just refuse it and wait for the other offers to come in.
Do you have your own experience about winning (or losing) a bidding war? I’d love to hear about it in the comments below.