How to handle a bidding war

Dated: April 30 2021

Views: 135

A bidding war occurs when a home seller gets multiple offers. Since bidding wars are fairly common these days, it pays to plan ahead. You'll reduce surprises and stress, and be better prepared to negotiate.

For instance, I tell both my buyers and sellers to think about how sellers can respond to multiple offers. Sellers have four options:

  1. Counter all offers by asking for a “best and final” offer. Then choose the best.
  2. Accept one of the offers outright.
  3. Pick a few offers to negotiate individually.
  4. Reject all offers and wait for new ones. (It happens, though rarely.)

Other details that can affect the offer:

  • Sellers realize that the highest offer isn't always the best offer. Terms can also make a big difference.
  • Sellers know the appraisal could be a problem. Just because they accept a huge offer, doesn't mean the appraiser will agree. Sellers may ask for funds to make up the difference.
  • Buyers can consider adding an escalation clause to their offer, which says they will automatically increase their offer by some amount over and above the highest bidder, up to a certain cap.

I help my clients prepare for these and other scenarios during our pre-buying or pre-selling appointment. Contact me at (909) 316-6117 or  roger@rogerflowers.com to set up your no-obligation initial consultation. 

Blog author image

Roger Flowers

My name is Roger Flowers, and I am a REALTOR based in Redlands, California. I have a particular focus on the residential market, more specifically, assisting clients throughout the Inland Empire and S....

Latest Blog Posts

Tips on How to Close a Real Estate Deal

FOLLOW THESE TIPS WHEN LOOKING FOR REAL ESTATEBuying a new home and closing the deal can be an exciting and somewhat confusing time. The home-buying process is wrought with complicated procedures

Read More

DIY Home Repairs That Can Bite You in the End

DIY HOME REPAIRS THAT CAN BITE YOU IN THE END I love the idea of an independent homeowner. However, before diving into your DIY repairs, here are a few common places where a pro might be

Read More

6 Steps for Buyers Competing in a Tight Market

If you’re the newbie buyer on the block right now, it’s tough out there. How can you be more competitive when you’re up against tight inventory and higher prices? Plus, if you;

Read More

We Can’t All Rely on the Bank of Mom and Dad

Home prices are increasing faster than incomes, especially for younger households. Add in things like the pandemic and student loan debt, and it’s hard for many to see a path to homeownership

Read More