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No one wants to pay over the listing price for a home, but it frequently happens in a hot market. Other motivated buyers may start a bidding war that, in some cases, can lead to drastically overpaying for a home. If you plan to buy a house, you must be prepared for this scenario. You’ll save yourself considerable time and money so that you get the best outcome.

How to Survive a Real Estate Bidding War

1. Plan

When a bidding war begins, anticipate there being multiple bids and multiple back-and-forths. A desirable home is going to attract a lot of buyers. It’s easy to overpay, which creates problems if you have a limited mortgage budget or funds. When planning, assess the realistic value of the home. A real estate agent will compare it to other properties on the market. You can then set a limit to how much you’re willing to spend on buying a house. If you hit that limit, it’s time to back off and find another house to buy.

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2. Offer Cash When Possible

An all-cash offer is extremely attractive to sellers because they get full payment right away with no financial strings attached. If you have the means, offer cash—even if it’s lower than what another buyer is offering. The fact that it’s all-cash may be enough to sway the seller. When considering, look into safe options like borrowing against retirement savings.

3. Don’t Allow Emotions to Take Over

Everyone wants their dream home. However, getting emotionally invested during a bidding war is dangerous. It’s one of the main reasons people overpay for a house. It’s easy to forget about flaws the property has and areas you may need to renovate. If you win the bidding war, you may find you’re in considerable debt and that you don’t have the money to pay for dream renovations and other projects.

 

Planning to buy a house in the Phoenix, AZ, area? A real estate agent at Eastern Real Estate Company will ensure you have all the resources and support you need every step of the way. They carefully assess your criteria and will then help you find homes that match. If you plan to sell a house, they will also help with appraisals and marketing to ensure you get the greatest return. Call (602) 731-7597 to discuss available properties or schedule a consultation.

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