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Home bidding wars can break out

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Dear Heather,

We put in an offer for a property recently, and it turned out there were multiple offers on the property and it sold for more than the asking price. Are sellers able to do this? When we make an offer on another property how can we make our offer stand out?

Buyer

Dear Buyer,

An asking price on a property is exactly that. A property will always sell for the value the market will support. This means that in a weaker market they tend to sell for less than asking, but in a buoyant market they can end up selling for more.

It may seem hard to imagine but, even in today's market place, a property that is priced right and is in a segment of the market where demand is high can be subject to bidding wars.

The cycle has begun to turn around a little bit.

We currently have 40 per cent fewer properties (island wide) on the market than last year.

For inexperienced buyers it can leave them confused and wondering whether they could have presented their offer better. Regardless of the situation, making your offer to buy stand out among the others is important.

Keep your offer simple and straightforward.

In a market that has multiple buyers making offers, one of the best things you can do is keep it simple.

The highest offer is not always the best. For example if the buyer has not been pre-approved, or are waiting on their condominium to sell, or an inheritance from Great Aunt Flo in an estate that hasn't yet been probated. That isn't really a very strong offer.

So try and keep your offer as clean as possible.

Include a copy of your pre-approval letter, and keep contingencies to a minimum. That minor repair might be worth fixing yourself as opposed to putting it in the offer as a repair demand.

Try writing an offer letter. Your agent will probably ask you to fill out a fairly standard form just to clarify each condition for both parties however writing a formal letter explaining why you want to buy their home can be a good idea.

It is an opportunity to show the buyers how you will utilise the home. This is where you tell them about your family, how much you like the home and how it's perfect for your needs. It is not where you tell the sellers that you plan to gut their precious home and completely remodel it. It is best not to write an arrogant letter that expresses “there are many fish in the sea”. Instead, you want to convey that this home is the one you truly want to buy.

Personal Delivery. The next two have to do with follow through. It's a good idea to have your agent present your offer in person to the listing agent. It may sound old-fashioned but this can go a long way. Real estate, like all business, is about relationships. Phoning or e-mailing an offer may seem very efficient but it can be less effective.

Your agent should be prepared to build you and your offer up to the listing agent, and be prepared to answer any additional questions that they may have. This will give the agent a good presentation to take back to the sellers.

•Loan Officer Follow-Up. Another great tip is to let your loan officer know that you have made an offer on a property. If they need any updated information from you it can save you time to submit it promptly to keep your pre approval up to date.

Let the sellers know that you have done your homework and hope that they will accept this offer as this home is a good fit.

Let them know that you're prepared to move quickly.

Most important, work with them and their time frame, and be able to move in good time when it comes to close escrow.

Heather Chilvers is among Coldwell Banker Bermuda Realty's leading sales representatives. She has been working in real estate for 28 years. If you have a question for Heather, please contact her at hchilvers@brcl.bm or 332-1793. All questions will be treated confidentially. Read this article on Facebook: Ask Heather Real Estate

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Published September 13, 2016 at 8:00 am (Updated September 13, 2016 at 9:51 am)

Home bidding wars can break out

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