How to win a real estate bidding war in Metro Vancouver
In a red-hot real estate market where inventory is low, prices are high and competition is fierce, the seller holds exponentially much more power than the buyer.
Multiple offers have become the new normal in the Vancouver market, with many properties selling for hundreds of thousands of dollars over the asking price.
Those bidding wars have buyers going to extraordinary lengths just to get a chance at getting into a market that’s really out of control.
CTV Vancouver has compiled a list of expert tips to help you get the property you want, if you’re faced with a multiple offer situation.
1. Unconditional offer
Gone are the days where offers can be subject to financing, inspection or lengthy waiting periods. The key to winning a bid now is going in with zero conditions attached. That means having your financing in place well ahead of even going to see properties. It can also mean having a bank draft deposit in hand to present to the realtor and homeowners.
Realtor Gary Serra says it can also help to make sure that deposit is bigger than your competitor’s.
“I think in some cases people are coming in with a higher deposit because, again, if you want to stand out compared to other offers – obviously people will notice that,” he told CTV Vancouver.
2. Do your home inspection early
It used to be that you could include a home inspection in a conditional offer, but that practice all but gone by the wayside in this frantic market. Many potential homeowners are now opting to take their home inspector with them to open houses, where dozens of other buyers are doing the same thing.
“It’s really crazy,” said home inspector Shawn Anderson. “I was just in one recently where it was so packed it was like they were giving away free wine.”
With some people putting in bids on multiple properties before actually winning a bidding war, this can add up to thousands of dollars in extra costs during house hunting.
3. Write a personal letter
Although it’s far from a requirement to pen a magnum opus to the current owner of the home, Metro Vancouver realtors say it’s worth the effort in a bid to make a personal connection to the seller.
Serra said explaining why you want the home can give interested parties an advantage over others.
“We want to appeal to the seller and make sure our offer stands out over someone else’s,” he said.
In its tips for writing a letter, Realtor.com says homebuyers should use flattery whenever possible, and compliment the current owner on the condition or décor of their home. In a market like Vancouver, where many heritage homes are torn down to make way for newer buildings, it can help to mention if you’re planning to keep the home intact.
4. Appeal to the seller’s timeline
Your needs should come last when it comes to the real estate sale, says Serra. Home sellers don’t want to be bogged down while interested parties secure a mortgage or sell their current home, so try to make things work in the timeline they want. They may have purchased another property and don’t want to wait around to get out of their current residence.
New buyer Kyle Gould says he’ll take any advice he can get. Just moving to B.C. from Ontario, Gould says he has been hit by “sticker shock” and a big reality check about the market.
“It kind of smacked me in the face that it’s a wild game out here,” he said.
With a report from CTV Vancouver’s Scott Roberts