Several times this past week, I have seen buyers prevail in multiple bidding situations by doing one particular thing: building the seller's confidence.
It’s an interesting process. A seller lists their home for sale, and if they've named that "sweet spot" price, it will usually draw multiple bids. Buyers and brokers are generally cognizant when multiple offers are forthcoming and that the seller generally will neither negotiate or take the first offer that comes to them. Most often, they've been told that others are bringing bids and, naturally, they want to wait and see how the market unfolds.
The bidders are now left with a choice. I’ve seen some buyers throw in a “place saver” offer, generally low, just to let the seller and seller’s agent know that they will be participating in the bidding process. Often, these buyers feel their bid will be “shopped”, so they don’t want to show their hand. Of course, if the property is going into sealed bids, there's no way of knowing how high another bidder will go anyway. On the other hand, I've seen buyers come in with a very strong offer from the very beginning to convey that they want the house. Time and again, I've witnessed proactive bidders prevail in the end.
Put yourself in the seller’s shoes. Their objective isn't only to get the highest price for their home, but know they're going to a closing table. We've all heard of those multiple bidding situations where the first bidder backs out. This can happen a week or two after multiple bids, after the “back up” bidder’s are often gone. No seller wants this. On one listing we had, one bidder put in a very low offer to start and the seller dismissed him as not being serious about their home. That same bidder, when it came to sealed bids, was as high and competitive in terms as the next highest bidder who had come in strong from the beginning—but the seller had already lost confidence in the original low bidder and accepted the other offer. Failed strategy.
You never get a second chance to make a first impression.