The housing market had been in a slump, and there just were not a lot of buyers with money. Things have changed recently, and now buyers are more numerous, making the real estate bidding wars start up again. Sellers are glad because their house is much more likely to sell faster.
In some places like California, Money.CNN.com reports, 9 out of 10 homes received competing bids. In the east, cities such as Boston, Washington DC, and New York had experienced a similar revival of bidding wars. Instead of wondering if there will be any competitive bids, the question now is how many a home might get in some areas. One home in California received 62 bids from different prospects.
The Demand Is Up
One thing that seems to be behind the new rise in real estate bidding wars is that the demand for new houses in definitely on the increase. NewYork.CBSLocal.com also says that the rising interest rates is pushing people to buy homes now and pay cash for them, rather than wait and have to get a mortgage later. Buying a home now is getting tougher fast because now there are many more buyers you will need to compete with – which is going to raise the price on the home.
More Buyers Are Looking for New Homes
It seems as if the real estate market has totally been reversed. Business.Time.com reports that Lawrence Yun from the National Association of Realtors (NAR) says that buyer traffic is now 40 percent higher than it was a year ago. Buyers are almost disappointed that there are not more listings on the market, but this is good for sellers.
Owners Are Often Underpricing
It is not unusual, partly because of the slower market in the recent past, that sellers are often underpricing their homes. The listed prices are often below market price, but they may well be aware that it will usually generate multiple bids on their home. This tactic is especially useful where houses are moving fast and the demand is up. While it does not always work, it often means that the seller could easily get more than their original asking price.
How to Win Real Estate Bidding Wars
When you have multiple bids on a single property, it can be hard to know how to plan on winning when you put in a bid. BankRate.com says that in some areas a home may receive as many as 10 to 15 bids on the first day a home is put on the market. One way to help ensure that your bid will win is to prepare yourself financially to buy the home. You also want to know what homes sell for in a given area. It is also important to get preapproved and have all of your paperwork ready – even before you start to look for your next house. It will also help to offer a larger deposit – possibly 20 percent or more.
Real estate bidding wars can enable you to get your next home quickly. By being prepared in advance, you may be able to obtain your next home within a very short period of time.