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Top 3 Ways to Lose a Luxury Home Bidding War

by Gwen Holloway and Elena Sanwick, REALTORS®, LUXE Real Estate Group—Luxury Prescott

The Northern Arizona luxury home market currently is highly competitive, with the average days on market often in the single digits.

Multiple offers are now the norm, so it’s imperative to know what to do and, more importantly, what not to do to win the home of your dreams.

1. Incomplete paperwork and/or not following directions

When multiple offers are expected, the listing agent typically sets a specified deadline for receiving offers. If your agent submits incomplete documentation with your offer, or misses the deadline, the listing agent may not be willing or able to wait for your agent to get their act together, based on their client’s needs or directives.

Something as simple as a missing an HOA addendum or the absence of proof of funds may be a deal breaker in a competitive environment.

2. Sale of current home contingency

Buyers who need to sell their current home before closing on a new home are at a tremendous disadvantage in the current market.

Unless the buyer is offering a significant advantage to the seller in another way (e.g. a higher offer), most sellers are not willing to consider the additional risk that acceptance of this type of contingency presents.

If at all possible, eliminate any contingencies before you submit an offer.

3. Financing vs. cash

Buyers who chose to finance the purchase of their luxury home face an uphill battle in a multiple-offer scenario, if a competing offer is cash. There are ways to strengthen a financed offer, however.

A substantial down payment and a willingness to waive the appraisal contingency (adding to the down payment amount if the appraisal comes in low) go a long way toward leveling the playing field.

Bottom line — the current luxury real estate market is tough for buyers right now!

But if you arm yourself for battle with a local, experienced, professional full-time real estate agent who approaches each engagement with respect, knowledge and a winning strategy, you’ll soon be enjoying the home of your dreams.

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