Fee-free mortgage broker Mojo Mortgages has asked its in-house expert mortgage advisors to share their top seven strategies for helping someone stand out in a property bidding war.
Mortgage brokers share 7 proven tactics to win a property bidding war
Here are Mojo Mortgages’ top tips to help you make a winning offer and secure your next home.
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Always lead with your strongest offer
Keen to avoid a bidding war altogether? Offer your best price at the start. If someone goes higher, you’ll know it’s time to walk away. This can be less stressful than bidding in small increments, which can sometimes lead to buyers being tempted to go over their budget.
Do, however, make sure you can afford the house. Previous research from Which? Has revealed that four in 10 (41%) of 18 to 24-year-olds have had a mortgage application rejected, so it’s important your house-buying budget is realistic, and you’re financially ready before putting in an offer.
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Show you mean business with a Mortgage in Principle
Before house hunting, you should apply for a mortgage in principle (MIP). This is a document that indicates how much you might be able to borrow to buy a property. While it’s not a guarantee you’ll be able to get a mortgage for the same amount, it does show sellers and estate agents that you’re a serious buyer. This can put you in a great position if you’re up against other prospective buyers.
After all, if you were selling a property, would you rather sell to someone who a lender has already assessed versus someone who simply told you they could afford to buy your home?
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Bid an odd number
Offering a more precise figure is more likely to be accepted, according to psychological studies. Sellers might place more value on a specific number rather than a round number, which suggests you’ve chosen a figure from random rather than working out those numbers.
So, for example, instead of offering a nice neat £250,000, consider giving £250,500 a try instead.
Top tip: It’s worth adding on top of a precise figure rather than falling below it, just in case another buyer offers that nice round number.
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Make it clear that can work with the seller’s timeline
It’s not all about the money. Many sellers would love a stress-free, straightforward process!
If you can, find out why and when they want to sell. This could help you to offer flexibility, which may well persuade the seller to choose you over other buyers who may have their own set timelines in mind.
For example, the seller might be keen for a quick sale or they might actually need extra time to move out and be looking for a more patient buyer. This is, again, where being chain-free can be advantageous as you won’t have any additional pressure from your own buyer to worry about.
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Be responsive in communicating
Waiting around a week or two to put in an offer will likely see you lose out to another buyer who’s ready to make a quick decision. Of course, don’t rush into your decision, but don’t ghost the seller either. Poor communication is a big red flag. After all, this gives the seller an idea of what it’ll be like to deal with you throughout the process.
It’s also worth remembering that estate agents play a key role so, while they won’t be able to influence the sale, it can’t hurt to be polite and pleasant to deal with.
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Sell yourself… but be realistic
Some homeowners may be more motivated to sell to a buyer they connect with. So, when providing your written offer to the estate agent, consider including a short note explaining your position and why you want to buy the house.
A word of warning, though. Overly emotional letters may feel manipulative and are often unlikely to even make their way to the seller. Stick to the facts and highlight why you’d be a great, reliable buyer. For example, if you’re a first-time buyer or coming to the sale chain-free, make sure your seller knows about it!
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Be a ready-to-go buyer
If you already own a home, you’ll have a better chance of having your offer accepted if it’s ‘sold subject to contract’, which means you already have a buyer lined up. It’s not unheard of for some buyers to sell up and move into rental accommodation before searching to improve their chances of securing their perfect home, though this comes with its own risks. Our guide on how to buy and sell at the same time goes into more detail.
If you’re a first-time buyer, you have a natural advantage here as you’re not part of a chain. Sellers love a smooth sale, and a chain-free buyer reduces the risk of delays or deals falling through.
“Keep house hunting even if you’re in the middle of a bidding war. It’s so easy to become fixated on a great property being ‘the one’ which can lead to you going over budget to try and secure it. But there are plenty of other homes out there! You might find another property you like just as much, with less competition.”