If you have found the perfect property, it stands to reason it will probably have ticked the dream home box for other buyers too. So, how do you ensure your offer is the one accepted?
It’s not just a matter of chance – sellers are looking for a buyer who is reliable, mortgage-ready and set to go. If you can add chain-free and a cash buyer to this list you will probably boost your credentials no end – but this not realistic for most of us.
If you want to gain the edge Emily Smith, mortgage expert at Mojo Mortgages has offered seven strategies to help you stand out in a property bidding war.
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Lead with your strongest offer
If you begin by offering your best price at the start, you can potentially avoid the stress of a bidding war altogether. Then, if someone goes higher, you’ll know it’s time to walk away. Smith said: “This can be less stressful than bidding in small increments, which can sometimes lead to buyers being tempted to go over their budget.”
With research by Which? showing 41% of 18 to 24-year olds have had a mortgage application rejected, it’s vital that you don’t overplay your hand with an offer you cannot afford. So make sure your offer is within your budget.
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Be ready with a Mortgage in Principle
Before house hunting, you should apply for a mortgage in principle (MIP), Smith advises. Also known as a decision in principle, it’s a document which indicates how much you might be able to borrow to buy a property.
“While it’s not a guarantee you’ll be able to get a mortgage for the same amount,” Smith explained, “it does show sellers and estate agents that you’re a serious buyer. This can put you in a great position if you’re up against other prospective buyers.”
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Bid an odd number
This might sound a bit odd – but there’s science in it. Psychological studies suggest being ‘more precise’ can mean an offer is more likely to be accepted.
Smith explained: “Sellers might place more value on a specific number rather than a round number, which suggests you’ve chosen a figure from random rather than working out those numbers.
“So, for example, instead of offering a nice neat £250,000, consider giving £250,500 a try instead.”
Smith’s top tip for this step is to add it on top of a precise figure rather than falling below it, just in case another buyer offers the obvious round number.
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Be flexible with the seller’s timeline
It’s not all about the money, Smith said. Sellers also welcome a stress-free, straightforward process. If you can find out when and why they want to sell, you can use this to your advantage.
“This,” explained Smith, “could help you to offer flexibility, which may well persuade the seller to choose you over other buyers who may have their own set timelines in mind.”
This can work both ways, whilst some sellers will want a quick sale there may be others who need extra time and are keen for a patient buyer.
Being chain-free can be advantageous here, as you won’t have any additional pressure from your own buyer to worry about. However, the main message is to investigate the seller’s situation and be as helpful as possible.
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Be responsive in communicating
Whilst you shouldn’t rush your decision, ghosting the seller won’t do you any favours either, Smith explained. Indeed, waiting too long to put in your offer is a sure way to lose the bidding war.
Smith said: “Poor communication is a big red flag. After all, this gives the seller an idea of what it’ll be like to deal with you throughout the process.
“It’s also worth remembering that estate agents play a key role so, while they won’t be able to influence the sale, it can’t hurt to be polite and pleasant to deal with.”
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Sell yourself… but be realistic
Smith thinks some homeowners may be more motivated to sell to a buyer they connect with.
As such, she suggests including in your written offer to the estate agent a short note explaining your position and why you want to buy the house.
There’s a word of warning, though. “Overly emotional letters may feel manipulative and are often unlikely to even make their way to the seller,” Smith advised. “Stick to the facts and highlight why you’d be a great, reliable buyer. For example, if you’re a first-time buyer or coming to the sale chain-free, make sure your seller knows about it.”
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Be a ready-to-go buyer
If you are literally ready to go you will be at a huge advantage. First-time buyers already have the edge here thanks to being chain-free.
Smith said: “Sellers love a smooth sale, and a chain-free buyer reduces the risk of delays or deals falling through.”
For those already on the property ladder, Smith said your offer is more likely to be accepted if you already have a buyer lined up for your current property.
She added: “It’s not unheard of for some buyers to sell up and move into rental accommodation before searching to improve their chances of securing their perfect home, though this comes with its own risks. Our guide on how to buy and sell at the same time goes into more detail.”
And one final piece of advice…
Even if you have fallen in love with a home and you are working on putting in the best offer, don’t pin all your hopes to this one alone.
Smith said: “Keep house hunting even if you’re in the middle of a bidding war. It’s so easy to become fixated on a great property being ‘the one’ which can lead to you going over budget to try and secure it. But there are plenty of other homes out there!
“You might find another property you like just as much, with less competition.”
