1. Look when no one is looking.
For first-time homebuyers, submitting an offer during a holiday or big event can help you avoid competition. Squeeze in a home tour during the Super Bowl (at least during halftime) or submit an offer on the Fourth of July. Another strategy is to track pending home sales. Sometimes pending sales are canceled due to the buyer’s financing falling through, and the home is suddenly back on the market. Get a head start by signing up for email alerts on real estate websites to get notifications if the property comes back on the market.
2. Know your limits.
If you want to spend $500,000, look for a home in the $450,000 price range. You need to give yourself room to negotiate during a bidding war. Homes that receive multiple offers typically sell for 3 to 10 percent above the asking price. Don’t get caught up in a battle and end up paying more than you wanted. Instead, lower your price point to leave yourself room to be competitive.
3. Waive contingencies.
Financing contingencies win bidding wars. For example, conducting and paying for a preinspection before you even present your offer to the seller can help set your offer apart from others.
4. Write a cover letter.
During a bidding war, it can sometimes come down to an emotional choice, and in those instances a heartfelt letter to the sellers can win the home. Be thoughtful about what you liked about the home. If you liked the fenced-in yard because you have dogs, mention it.
5. Wait it out.
If you do not want to pay full price and want to avoid a lot of competition, look for a home that has been on the market for at least 15 days. Homes for sale usually lower their price after being on the market for 15 days. And to avoid competition, submit an offer on the 13th or 14th day. This is usually the time when a seller and selling agent start discussing a price drop, making it an opportune time for you to swoop in and submit an offer below the original asking price. If you wait until after a seller drops the price, then be prepared to compete against other buyers who could likely submit offers that drive the price back up.