It is hard to resist making an offer when you find the perfect property. You might be worried about overpaying or offending the seller, but with some careful planning, you can make an offer that will not scare them off and stands a good chance of being accepted. Here are 15 tactics to help you make a successful offer on a property.
Tactic 1: Do Not Make the First Offer
The seller might expect you to make an offer, but that does not mean you should automatically bid. Instead, wait and see what other buyers do first. If multiple buyers are interested, make sure your offer is as competitive as possible.
However, if there appears to be only one or very few others looking at the property—or none at all—you could try making an early bid to sweeten the deal for yourself even more.
Tactic 2: Do Not Bid More Than You Can Afford
If a bidding war breaks out—which can happen with highly desirable real estate—always stay within your price range. Many buyers end up going over their budget because they are swept up in the heat of the moment. By bidding more than you can afford, you will endanger your financial future and risk losing out on other homes.
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Tactic 3: But Bid More Than You Think It Is Worth
If there are no other bids and it seems like the seller might accept a low offer, bid just slightly above that to encourage them to choose your bid over one that is lower. Be prepared for the seller to counteroffer by offering less than they wanted, though—it can take multiple rounds before a final deal is made.
Tactic 4: Package Your Offer with Other Offers
If competing with other prospective buyers, package your offer with other deals. If another buyer seems like they might withdraw from the bidding, include them in your bid as well so that there will not be any gaps left behind—the seller will likely choose one of your bids over no offer at all.
Tactic 5: Offer More Than You Can Afford
As mentioned above, it can help bid slightly higher than you might have been planning. The “more than you can afford” part can feel uncomfortable (and it should!), but research shows that you will probably have a better chance of winning when you bid more than the asking price.
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Tactic 6: Use Incentive to Make an Offer That Will Be Accepted
Including incentives with your offer can make it more attractive to the seller. For example, maybe you could include a home warranty or promise to pay for closing costs—anything that would be beneficial for them and encourage them to accept your offer.
Tactic 7: Offer Guarantee – But Not Too Much of One
Offering a guarantee on your offer is always a wise move as it makes it seem more secure for the seller. However, ensure that you are careful of how much guarantee you offer. If it is too high, it can make the seller assume that there might be problems with the home once they own it—and nobody wants that!
Tactic 8: Include Details About How Much You Are Willing to Pay for Utilities
Having to pay for utilities on top of your mortgage is always annoying. Let the seller know what utility costs are included in your offer by including this information with the bid.
The additions do not have to be anything fancy either—just listing all the services included might be enough for them to choose your offer over another one without any details about utility costs.
Tactic 9: Use Closing Costs as an Incentive
Closing costs are one of the biggest deterrents for buyers, but it is also one of the most manageable hurdles to get over. So, you can make your offer very appealing by including an incentive like waiving or covering closing costs.
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Tactic 10: Get Creative with Add-Ons
Sometimes, it is beneficial to include more than just financial incentives with your bid if you are competing with multiple offers. Depending on how much creativity you are allowed (i.e., what the seller is open to), consider throwing in personal items like furniture, appliances, etc.
Tactic 11: Offer to Close More Quickly
If you are the only person making an offer, offering to close faster can help you beat out other offers. However, ensure to prepare for the possibility that the seller may counteroffer by asking for more time—and if they do, consider whether or not it is worth your time to agree to a later closing date.
Tactic 12: Make Your Offer More Specific
Nobody wants an ambiguous “I will buy it for X” kind of deal. However, if you make your offer more specific (i.e., I will buy this home for $220,000), then the seller knows exactly how much money is on the table and what they have to gain if they accept your bid over another one.
Tactic 13: Add Specific Closing Dates to Your Offer
If you genuinely are the only person making an offer, or other offers have fallen through, offering a specific closing date can make the difference. It also works well if you want to include extra incentives (or even particular add-ons) with their bid—if it takes too long for you to close on the deal, these might disappear!
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Tactic 14: Include a Letter with Your Offer
The best way to personalize your offer is by including a letter that explains why you are interested in the home and what makes your family a good fit for it. It could be as simple as telling them about yourself and your growing family, how much you appreciate particular features of the house itself or any other selling points you think will make the seller take your offer seriously!
Tactic 15: Include an Escalation Clause
A house might be listed at $250,000, but the seller is willing to negotiate. If you want certainty that your offer will get accepted even if they change their minds about how much the home is worth, include an escalation clause with your bid. It lets them know that “If we cannot agree on a price, I will bid $250,000 and no more.”
Offering creative incentives is one of the best ways to convince the seller that your offer is the best—and using these 15 tactics, you can create an offer they cannot refuse!
As we conclude our exploration into effective property investment, it’s worth noting the support and resources available through Intellifund. Proudly serving as a seed investor for PropTech companies.