Don’t Make These Bidding War Mistakes

By
Real Estate Broker/Owner with Sandra Nickel REALTORS

The current real estate market is still a sellers’ market, meaning bidding wars are not the exception, but the rule when trying to purchase a home. If you are attempting to buy in a desirable area, there are likely to be multiple offers on the property you want, meaning you will have to be competitive to come out on top. It is easy to get caught up in the process and your desire to “win” at all costs may, well…cost you.  Mistakes might not only cost you the home of your dreams but might also have you end up in a house that you regret. So, you need to be careful out there!

Here are some common bidding war mistakes to avoid:

  • Bidding ALL Your Money

NO. Don’t do it. With houses selling for thousands of dollars above asking price, it may be tempting to empty your budget just to “win”. But what if you do get the house and it needs repairs and/or updates? With all your cash gone, you will be left with nothing to put towards improving your new home. DO NOT PANIC and make impulsive decisions that you will come to regret.

  • Rushing to Bid

If you don’t have your financing in place or know exactly where your money is coming from, then now is NOT the time to get into a bidding war. For example, if you make your offer contingent upon the sale of your current house, you are likely to lose in a bidding war because the seller will choose a buyer that has the fewest contingencies. Get pre-approved for a mortgage loan and have all your ducks in a row to stand out to sellers.

  • Bidding with NO Contingencies

Desperate times call for desperate measures, but there are some contingencies that you should NEVER waive. Waiving a home inspection and the ability to back out of the deal if the inspection reveals major issues would be a BIG mistake. It is just not worth the risk. You can compromise on other contingencies but sacrificing the right to inspection is never a good idea.

  • Counting on a Second Chance

When entering a bidding war, it might be tempting to make an offer that leaves room for you to make a “better” offer later. But with so much competition, you likely won’t get a second chance. Work with your Realtor to write your bid as if it is the only bid you will make. If you’ve done your homework and have your financing in order, you should already know the limits of your bidding potential. If you don’t win the bidding war, it simply means the property was not the one for you.

One of the most important things to do when entering the market to buy a home right now is to find an experienced, professional Realtor to help you through the process. Their knowledge of the market along with their expert negotiation skills will be invaluable in your quest to find, and win, the right home for you!

If you are in the market to buy or sell a home (or both), let me Sandra Nickel, and my Hat Team of Professionals assist you with all your real estate needs! Call us today at 334-834-1500 and check out https://www.homesforsaleinmontgomeryalabama.com for more information.

Photo credits: ovmfinancial, dsnews, fincancebuzz

Comments (8)

Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Sandra and thanks for the great information to share with us today.  The future will be interesting.

Apr 06, 2022 09:53 AM
Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

Hi Sandra,

Thank you for sharing the real estate information.
Buyers and sellers in your area will benefit from your expertise.
Wishing you continued success. bill

Apr 06, 2022 11:32 AM
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Good morning, Sandra... great advice. The mistake I've seen more often than not is assuming a buyer will get a second chance to make a better offer. As often as not, that does not happen. 

Apr 07, 2022 03:50 AM
Ben Yost - 303-587-4297
First Time Home Buyer, Mortgage Rates, Pre-Approval - Denver, CO
FHA, VA, Conventional - Mortgage Loans in De

Good Stuff. I've seen Agents do all the wrong stuff.

Apr 07, 2022 09:59 AM
Sam Kader MLO 130505 MB 78982
Pacific Coast Financial LLC Lic# MB78982 - Seattle, WA
Real Estate NMLS 91980 Mortgage Broker Lic MB78982

Excellent tips Sandra. However, most home buyers here in Seattle are heedless. 

Apr 07, 2022 11:10 AM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Sandra:

Lots of wisdom in your post! This crazy market has fueled some risky decisions by buyers.

Jeff

Apr 07, 2022 11:21 AM
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experienced Agent in Kansas City Metro area

I agree that waiving an inspection is not a good idea but most buyers do that in this market for the most desirable homes.  Sometimes the buyer/agent will take an inspector to the home during the showing period. 

Apr 08, 2022 01:14 PM
Kristin Johnston - REALTOR®
RE/MAX Platinum - Waukesha, WI
Giving Back With Each Home Sold!

Great information.   Thanks for sharing and enjoy your day!

Apr 20, 2022 07:02 AM