After viewing many properties, you may finally find your dream home. However, as ready as you may be, so are other buyers. Alongside this, if you’re the seller – a bidding war can be stressful and confusing.
The competitive nature of the house-buying market at the minute is high, so you need to be prepared for a bidding war. Keep reading to learn more on how to handle bidding for a house.
What is a house bidding war?
A house bidding war is when the seller receives multiple offers. This can result in a house going way over the asking price. The seller can ask for best and final offers and then choose which offer sounds the best to them.
Why do house bidding wars happen?
In the current market (2022), the demand for houses is high – which often results in around 10 people offering on one house. If a house is in good condition and in a good location, it will immediately attract a variety of buyers, who may all want to offer.
However, this isn’t to say that a house has to be in great condition to go to a bidding war – often it can just be a case of the house bringing in huge interest.
How to get involved in bidding on a house with multiple offers
There are misconceptions that getting involved in bidding wars means giving your highest offer straight away to blow the seller away – this isn’t true.
Below are some bidding for a house tips to help you be in with a chance.
Make sure you can afford it
Whether you’ve used a mortgage calculator or you’ve spoken to a mortgage broker – make sure you know how much you can afford and what your limit is.
There is no point bidding a huge amount if you won’t actually be able to get a mortgage on the house. In many cases, to make a serious offer, estate agents and vendors require proof of an AIP.
Be serious and present yourself well
A seller is going to want to know all the details about the offers that come in. Make sure that, along with your offer, there is information about you and your situation. For example:
- Are you a first time buyer?
- Are you in a chain?
- Do you have a deposit?
- Do you already have an AIP?
- When could you move in?
All the answers to these questions are going to be considered by the vendor – so it’s important you answer truthfully and correctly.
Consider your best and final
It’s not uncommon for bidding wars to go to best and finals. This means that once you’ve offered an amount – the seller wants to view all the best and final options to make a definite decision.
This is your chance to up your offer. In many cases, it can be down to who is willing to pay the most, but it is not always just about this.
Have a think – set yourself a limit and be realistic. Remember, even if you want to offer a lot of money for the house, the bank might not think the same.
Don’t be stressed about your offer
Once you’ve offered on a house – it can be extremely stressful while waiting for the answer. Take deep breaths and remember that you’ll find out soon – if this house isn’t the one, there are plenty more to choose from.
On the flip side, if you think you’ve put in an unrealistic offer or can’t follow through – a bid isn’t legally binding. It can be very easy to get caught up in the excitement of bidding for your dream house and paying over the odds – you are allowed to back out if you want to.
How to deal with multiple offers as a seller
As a seller, getting multiple offers might seem like a great thing – you’ve got lots of people wanting to buy your house! However, it can be a bit more intense than that.
Although it can be tempting to immediately choose the offer is offering the most money, there are other things to consider. Such as:
- Are the buyers in a chain? How long will the process take?
- Do you have a new house to move in to? Do you need a speedy sale?
- Do they have a deposit? Is there AIP ready?
Estate agents can help you through this process, by checking funds are there and that the buyer is in a good place regarding employment.
Take the process slowly, look properly over all the offers, and consider what you want from your house sale.
Bidding for a house can be an incredibly tense experience and can often be quite daunting if you’ve never done it before.
Here at Sett Mortgages, we’re here to help you from the start. Once we’ve found out your property budget, we are on hand 24/7 for when you find a property you like. When you’ve found something – we can work together on an offer and handle a bidding war together if it comes to it. Get in touch today to learn more.