The highest bid doesn’t always win the house, but why?
Sellers aren’t just trying to get the most money. Redfin, a real estate analytics company, recently released a comprehensive study of successful real estate strategies. They used a pool of 10,000 competitive offers to see who wins the most:
- All Cash Offers: 44% success rate
- Buyer Conducted a Home Inspection: 42% success rate
- Waived Financial Contingency: 40% success rate
- Buyer Included an Escalation Clause: 32% success rate
- Offer Included a Cover Letter: 37% success rate
Now if you’re offering a little more over list price AND use an all cash offer, conduct a pre-offer inspection or include a cover letter, your chances will go up. Just remember that when it comes to luxury real estate in the GTA, a high ball offer isn’t enough. You have to find that competitive edge that makes your offer stand out from your competition.
Making Yourself Stand Out
It’s all about making yourself stand out - and what’s the best way to get someone’s attention?
Cash usually does the trick.
If you’re at an open house for example and the seller is hanging around, talking about how they need to sell quickly, an all-cash bid that’s slightly lower than all the others may win you the home. They may be selling the home, but you need to sell your offer in the best light possible.
That’s why you want to work with the Goodale Miller Team (that’s us!) to make sure you’re doing everything right to win your bid.
What’s it Really Worth to You?
Let’s say this is the first time you’ve ever bought a luxury home - you’ve found the one you want, but you’re just not sure how to get their attention. You put a pre-inspection contingency on your bid, but the sellers choose another buy with a higher offer.
The buyer with the higher offer also wants to inspect before the offer is accepted, and they find a few issues they don’t like. They try to lowball the offer down, cause the seller a bunch of stress and worry, and then the seller turns back to you.
The nice buyer that just wanted to do a nice, clean buy that wants a stress free closing. Someone that just wants to buy a house.
That’s more valuable than a few extra thousand on top to a seller that needs to raise funds quickly. Even if you can’t do an all-cash offer, offering a stress-free closing to a seller could be the thing that puts you over the top.
This is just one example of a winning strategy, but if you really want to win, let The Goodale Miller Team help! We’ll help you understand everything from how much to bid to how to present your bid to get a seller’s attention - everything you need to be successful.