Investing in a new home should be done wisely, but with real estate flying off the shelves in Oakville and the GTA, it can be too easy to get caught in bidding wars and suffer the consequences of bad decision-making. Here are some tips to help you win a bidding war the smart way.
Mind Your Numbers
Make sure to have an idea of how much you can afford so that you’ll know exactly how high you can offer without landing in financial trouble later on. People who only consider monthly payments may end up grossly overpaying because thousands upon thousands of sum over the asking price often only equates to a small additional sum monthly. Know your numbers!
Do the Legwork
Purchasing a home is most probably one of the most expensive financial decisions you’ll ever make. Be sure to research the neighbourhood and don’t get caught up in just how pretty the home is. You wouldn’t want to end up paying for access to amenities that you don’t need.
Mind Your Timing
Avoid the weekend open house competition by trying to view properties as early as possible during the week so you can have an offer ready by Thursday. Avoiding the house also allows you to do a fairly extensive house inspection and if you want to, you can also bring in an expert for consultation.
Get a Real Estate Agent that Puts You First
Your number one weapon in a bidding war is a real estate agent who has your best interests in mind. It is your agent’s job to seal the deal and respect your budget, plus research the neighbourhood to make sure you’ll be getting what you want. A real estate agent will also have access to key information that you can use to make a wise home buying decision.
Stick to Your Budget
It is normal to want what everyone else wants, but just because something is considered a ‘hot item’ does not mean that it will be good for you as well. Don’t be blinded by stories of people making good money because they bought a property at a ‘rising’ neighbourhood years ago. Be careful and always think of your current reality than be swayed because of a possibility of making it big down the road. You won’t want to end up stuck with a home you don’t want and can’t afford.
Keep Your Offer Clean
Surprisingly, it is not always the highest bid that often wins a bidding war. There are plenty of times that the property ends up going to the cleanest bidder, and by that, we mean an offer with preapproved financing.
Try to Be Flexible
But only to a degree. It would be great to move up the closing date if that will work better for the seller or agreeing to purchase the property as is (without a few missing tiles getting their replacement first, or one window fixed first) can bring the ball to your court by making your offer stand out from the rest.
If you can afford it, a big deposit means that you mean business and can sway the final decision to your favour. Remember that your deposit goes down to your down payment anyway so it isn’t like you’ll lose anything. If you can, try to make a large deposit coupled with a clean offer to get a sure win!
Try a Personal Touch
Writing a letter to the seller stating why you wanted the house so much and who you are can work like a charm. Purchasing and selling a home is a very emotional time for everyone, and sellers are more likely to choose a buyer that they can identify with.
Don’t Be Afraid to Walk Away
Bidding wars have an ugly side. It is not a secret that some realtors strategically set lower prices for amazing homes to instigate a bidding war. Do not give in to peer pressure and always go with what you can realistically afford. Your debt-to-income ratio should just be around 30% of your income or you’ll end up being in big trouble. You won’t want to end up with an amazing home if it means sleepless nights, right? Be smart about your choices and in due time, you’ll find yourself your very own dream home.
Need help buying a home in Oakville? Contact us and let our team assist you! Not only do we know Oakville in and out, most of our team are Oakville’s own and would be happy to be your future neighbours! Have a chat with us today!