UNTANGLING THE BIDDING
Untangling the Bidding War: A Buyer’s & Seller’s Perspectives
In a competitive marketplace, bidding wars become the norm. While this may put sellers in an excellent position to recoup on their investment, it can push buyers beyond their budgets and test their temperaments in the process. As an agent, how do you navigate both sides of the coin? After all, you want to net the best results for your client—regardless of which side of the closing table they’re on. To fortify your approach to a heated bidding war, here are a few ideas and insights to better clue you in on the perspectives of buyers and sellers alike.
Buyer’s Perspective: Emotions Running High? Channel it.
When the market is booming, buyers feel the pressure—especially when affordable inventory is limited. This can create stress, feelings of hopelessness, and impulsivity. As an agent, how do you channel this emotional energy into something positive? Consider asking buyers to put those anxieties and high hopes onto paper. Have buyers outline
who they are, why they’re inspired to buy a home at this juncture in their lives, and how they see their lives unfolding once they become a homeowner (or repeat homeowner). Think of it as a letter of intent. Buyers benefit from taking abstract fears and dreams and articulating them on paper. Likewise, this document can serve as a valuable tool during a bidding war. Letters like these can help sellers with multiple offers make a personal, emotional connection with a particular buyer.
Sellers Perspective: Manage expectations.
When multiple offers are rolling in on a property, it’s easy for sellers to get carried away. Numbers are flying, expectations are heightened, and sellers may become hypnotized by higher and higher offers and ideal outcomes. While it’s good to celebrate prime market positioning, it’s also important to maintain an even keel so that your seller’s mind is clear and they’re thinking rationally through their options. Sometimes the highest offer isn’t necessarily the sure thing. Manage your clients’ expectations by leading by example, offering a balanced perspective, and talking them through all potential outcomes so that they don’t only hone in on the best-case scenario. During a bidding war, tensions are running high for seller’s too, who will soon begin their next chapter in another home. Keep a cool head and remind your client to see the big picture, recognize that it’s possible for some offers to fall through, and to sit tight until the closing table has been successfully reached. personal touch can make. Some popular approaches to standing out include personal letters—as mentioned above—tailored to the property. Was the property in question a family home for years? You might have clients detail their dreams of raising a family inside those walls, rather than tear the property down and rebuild something to boost the lot’s value. Including a family photo is also a good tact for personalizing letters in a bidding war. Likewise, little gifts included with your offer can speak volumes about your personality and due diligence as an agent. It may seem a little cheesy, but when sellers are looking at ten near-identical offers, those personal touches can really paint a compelling, personalized picture.
Seller’s Perspective: How powerful is cash?
Data shows that cash offers—typical of investor clientele—double the chances of having an offer accepted. This goes hand in hand with waiving a financing contingency, which also helped boost the probability of an accepted offer, according to research. Cash is king, however, since offers that aren’t completely reliant on comprehensive financing seem to minimize risk for sellers, who are already eager to see a deal go through. Cash deals also tend to go through quickly, freeing sellers up to pursue their next property and move on to new horizons. While not every buyer has the ability to operate in cash, it’s a worthwhile consideration for those in ultra-competitive markets and with liquid capital.
Buyer’s Perspective: How do you authentically and convincingly convey your interest?
When ten or so offers are in the mix, it can be hard to differentiate your buyer from the next. While numbers will obviously do a lot of the talking, you’d be surprised how much of a difference a While the bidding process can be stressful for agents and clients alike, it’s important to remember that it’s a time of opportunity, too. If you want to make the most of it as a seller, data shows that a personal touch can endear buyers to their seller counterparts. For sellers navigating a competitive process, it’s important to keep a balanced perspective. For agents, here’s the bottom line: get creative, be resourceful, and use all the tools in your arsenal to achieve the best result for the clients you serve.
Top Agent Alex Menoni is a broker with @properties, where he services clients in the heart of downtown Chicago and the surrounding suburbs, specializing in corporate relocation.
When he’s not fighting to stay on the cutting edge of Chicago’s real estate market, Alex Menoni can be found playing hockey, cheering on his favorite Windy City sports teams, enjoying live music or taking photos of the city’s iconic architecture. Having grown up in the Chicagoland area, Alex takes a special pride in showing his clients around its historic neighborhoods. “I always point out why I love this city,” he says, “and why they’ll love it, too.”
After studying marketing at Illinois State University, Alex spent a few years working in the professional sports industry. His focus shifted, however, when he met a successful Chicago Realtor who quickly became his mentor. “I’m not the kind of guy who can just sit at a desk,” Alex says, reflecting on what attracted him to real estate. “Being a Realtor allowed me to meet someone new every single day.” Taking this insight, Alex earned his license and threw himself into the business.
Today, Alex is a broker with @properties, where he services clients in the heart of downtown Chicago and the surrounding suburbs, specializing in corporate relocation.
When listing a home, Alex utilizes advanced technology, such as geotargeted social media posts, to generate buzz. “The in-person showing is usually your second showing, given all the information available online,” he says. “So it’s important to have engaging content that draws people in—whether that be professional photography or a quick video
distributed over social media.” On top of these targeted posts, Alex also provides an in-depth understanding of traditional listing and staging techniques, ensuring that a home is expertly presented at every step of the process.
As for buyers, Alex provides rigorous and attentive service. Most of all, he loves collaborating with first time homebuyers. “There are so many misconceptions out there about how much it takes to buy a home,” he says. “By crunching the numbers, I can show my clients that homeownership is much more attainable than they think.” Leaning on his extensive network of lenders, attorneys and home inspectors, Alex makes the buying process accessible and safe for all.
Meanwhile, Alex carefully educates his clients on not only their current listings, but also the state of the market. “I always have my finger on the pulse,” he says. “That way, I can have a good sense of buyer behavior and stay updated on market conditions.”
By keeping ahead of the curve, Alex has developed a strong reputation, with over 60% of his volume coming from either repeat clients or referrals. On top of that, he has been honored with @properties Outstanding Achievement Awards in both 2018 and 2019. “Success is a blessing,” he says. “But it speaks beyond any number; I’m just happy to make a difference.”
When Alex looks ahead to the future, he first wants to grow his team. Beyond that, he hopes to expand his reach beyond city limits. For now, though, Alex is satisfied leaving a mark in his beloved city. “I love where I’m heading,” he says. “Buying a home is one of the biggest investments someone can make in their life. More than anything, I want to remain a trusted resource in that decision.”
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