When a real estate market is as hot as Toronto’s, it’s not uncommon for a desirable property to find itself with multiple offers, which can quickly escalate to a bidding war. If you’ve found the property of your dreams, but find yourself caught up in such a situation, here are some handy tips that can help you come out on top.
What is it Exactly?
Before getting too stressed out about being caught up in a bidding war, Sage Real Estate Brokerage suggests giving yourself a quick reality check. While the term “bidding war” makes it sound like a free-for-all, that’s really not the case. Bidding wars are not auctions. A bidding war in Toronto is blind, meaning you’ll never know exactly what the other offers are, and how much above the asking price they may be. You are entitled to know how many offers you’re bidding against, but not the price.
What is the Home Worth to You?
RateSupermarket.ca warns against letting the emotional process of a bidding war overwhelm you. Buying a home may be the biggest purchase of your life. As a result, you need to really stop and consider what the house is worth to you and what your life would be like both with or without the property. If you get caught up in the excitement of a bidding war, you could potentially commit yourself to more than you can afford.
Don’t Lose perspective
Searching for a home can be an exhausting process, especially when engaging in bidding wars. However, don’t let your eagerness to be done with the process push you into making a deal that’s not right for your situation. Before you get into a situation like this, list your goals, what you can afford and what you ultimately need. Try not to depart from this plan and overextend yourself. The final result may not be worth it.
Get the Right Team
The Huffington Post warns that if you’re planning on engaging in a bidding war, you better have a solid team on your side. That means making sure you have a real estate agent you can trust, a good financial adviser and a lawyer. All of these people will help guide you through an often overwhelming market.
Make a Firm Offer
If you want to make an offer, try to make it without too many conditions. If a home inspection is a must (and it should be) do it before making an offer, even if it costs more. Sage Real Estate also advises having a cashier’s check for the deposit ready on the day of the offer so that your offer can become legally binding once accepted by the listing brokerage.