It is Seller's Market in which there are less properties on sale and when it comes on market it brings multiple offers.In many areas across Canada, local real estate markets continue to experience a trend toward a relative lack of home listings and an influx of active buyers. As a result, those ready to sell are in a favourable position to generate multiple offers on their home – often leading to buyers paying over market value for a property.
If you’re in the market to purchase a new property in an area that is experiencing this robust sellers' market, then the reality is that you may ultimately get into a bidding war with other buyers. There are certain strategies that can help position yourself and your offer above others.
1. Get pre-approved. Take the extra step and get mortgage pre-approval. By doing this and discussing your personal financial situation in depth with your lender, you’ll have more confidence in your buying power. This is paramount if you plan to not include a finance condition in your offer.
2. Understand the sellers' needs. Buyers often make the mistake of wanting to “win” in negotiations. However, in a hot sellers' market it is the seller that has the upper hand, not the buyer. Aim for a “win-win” situation. You can partly accomplish this by understanding what contractual components are important for the seller. For instance, if the seller is looking for a specific closing date, try to give them their preferred date – or something close to it.
3. Have fewer conditions. If you’re putting an offer on a home that has generated a lot of interest, you may need to consider not including some standard conditions (financing, home inspections). Although this is not a recommended approach, it is a reality. All things being equal, a firm offer in a bidding war will typically win over a conditional offer.
4. Include a large deposit. Your ability to put a large sum of money down on a home will provide the seller with confidence in your purchasing power. This can ultimately give you an advantage over other buyers in a bidding war.
5. Make a strong offer. Every local market differs in terms of what a strong offer may look like, but each market will typically have a trend that can be analyzed. For example, a trend may dictate that for every additional offer, your offer should be increased by $5,000 to $7,000 above asking price.
Century21 Active REALTY INC Brokerage.,
4181 Sladeview Cres, Unit 33
Mississauga, Ontario L5L 5R2
Direct: 647 200 2200
Off: 905-997-7653 Ext 200
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