Scott McGillivray’s Tips on Winning a Bidding War
Contributed to HGTV.ca by Scott McGillivray
With over a decade of investing in real estate under my belt, I’ve learned a few things about the buying and bidding process.
Whether you are a first time buyer, looking for a bigger home, or downsizing, investing in real estate is a smart decision – but only if you do it wisely. Bidding wars, unfortunately, may be here to stay, so here’s some advice that may help you to secure your next property.
Crunch the Numbers
One of the most important elements in the process of buying a home, particularly if you enter a bidding war, is getting pre-approved by your bank or mortgage company so you know exactly what you can carry -and how high you can go in your offer.
Do your Homework
Buying a property is the most expensive financial decision most people will ever make in their lifetime so spending time to research the neighbourhood is so critical. There is so much emphasis on house inspections, and there should be, but the same amount of care should also be spent checking out local schools, transportation links, parks, crime rates, medical offices, family activities, seniors programs, daycares and even future housing developments.
Nail the Timing
I try to get into properties on a Wednesday so I can put in an offer on Thursday and avoid the weekend open house competition – or before they are on MLS. By beating out the weekend competition, I might not have to enter into a bidding war. There’s no law that states that you can’t make an offer before the official offer date and a good agent should send you properties as soon as they are available and preferably before they go public.
Pick the Right Agent
Having an agent who has your best interest in mind is key to winning a bidding war. Your job as a buyer is not to seal the deal, it’s your agent’s job and they need to know what your limit it is – and respect it. If your agent tries to up sell you on the price and encourage you to go beyond your budget, it’s time to find a new agent.
Keep your offer clean
Surprisingly, not everyone is after top dollar when it comes to selling their home. I’ve put in a lot successful offers that may not have been the highest, but they were the cleanest. A clean offer with pre-approved financing, especially in a multiple offer scenario, shows the seller that you are serious. Conditional sales and offers that are contingent on financing just don’t fly when there are other offers on the table.