Quick Takeaways

  • “Know Your Numbers – “Knowing your budget and what you can afford is critical to your success as a homebuyer. The best way to understand your numbers is to work with a lender so you can get pre-approved for a loan. Pre-approval shows sellers you’re serious, which can give you a competitive edge.”
  • “Be Ready to Move Fast - Speed and the pace of sales are contributing factors to today’s competitive housing market. When homes are selling fast, it’s important to stay on top of the market and be ready to move quickly. Your agent will help you stay up to date on the latest listings and help you put together your best offer as soon as you find the home you want to buy.”
  • “Make a Strong but Fair Offer - ​When you’re up against other offers, putting your best offer forward from the start is key. Lean on your agent to write a strong offer and use their expertise on which levers you can pull to make your offer as enticing as possible. One option is to wave some of your contract contingencies (conditions you set that the seller must meet for the purchase to be finalized). Just remember there are certain contingencies you don’t want to give up, like the home inspection.”

Source: How to Navigate a Market Where Multiple Offers is the New Normal (Metropolist, Mar. 11, 2022)

The REALTOR® Code of Ethics does specifically touch on multiple offer situations in Article 1. REALTORS® must act in an efficient and timely manner, present counter-offers, and always work in the best interests of their clients. According to Article 1, Standard of Practice 1-8, REALTORS® have “no obligation to continue to show properties to their clients after an offer has been accepted unless otherwise agreed in writing.”

Outside of the Code of Ethics, there are other legal and ethical issues REALTORS® must consider when dealing with multiple offer and/or bidding war situations. There are designated time periods in which sellers can still accept other offers, some are legal but not necessarily considered ethical. Keep in mind that buyer love letters and other methods of gaining a “personal” edge in a bidding war can sometimes fall in a Fair Housing gray area.

When representing a client involved in a bidding war or multiple offer situation, there are many ways to help your client help themselves. Make sure they have secured stable financial backing, help them craft a competitive offer, and let them know some practical options that may sweeten the deal, like a quick close date. However, remember that your clients best interests are always number one, and it is your job to be the voice of reason in an emotional bidding war scenario.

As a client entering into a multiple offer situation, there are a few things you can do to increase your chancing of getting your dream home.  Be wary of too many or zero contingencies, and don’t bid above your financial means. Making a competitive offer right away and sticking to it is often the best bet for you, but ask your REALTOR® what else you can to do heighten your chances.

 See References for more information.