The London property market is not only the most expensive in the UK (by a long mile), but it’s also the most competitive. London properties are highly sought after not just by the millions of people who live and work in London, but large institutional investors and billionaires looking to grow their wealth further.
As a result of the massive competition that property buyers have to face for each and every property on the London market, being a standout buyer can be tricky. However, it’s not impossible, and that’s exactly what we’re going to discuss in today’s articles.
So, if you want to buy your dream home in London without feeling that there’s a ton of competition that may snatch your dream home from beneath you, read this article until the very end.
How to Get the House You Want in a Competitive Market?
In order to get the house you want in London’s competitive market, there are several things that you need to consider, including:
- The amount of money you’re willing to spend
- Where the property is located
- Where the property is listed for sale
The number one factor that will determine whether you’ll be able to get the house you want in a competitive market such as London’s is the amount of money you’re willing to spend on the property.
If your budget is quite tight and you’re looking at buying a property in a central location that is being advertised everywhere, chances are that there will be a lot of competition that will have the financial power to bid higher than you can.
So, you should either be willing to spend as much as necessary, or look at buying a property from a private seller who isn’t willing to sell their property through an agency. That way, there will be a lot less competition, meaning the number of bidders will be low too.
What Makes a Strong Buyer?
There are several characteristics that will indicate to the seller that you are a strong buyer with big interest in their property. The first one is obviously your financial abilities. However, it’s not all about money.
How fast you’re willing to move with the buying process is another key factor that many buyers on the market overlook. Sellers, especially those who want to sell their house fast, would rather settle for less, if the time it takes to sell can be as quick as possible. At the end of the day, no seller wants to wait several months to get the money that’s locked in their property.
Other characteristics that you should focus on if you want to be appear as a strong buyer include:
- How flexible you are with the demands of the seller
- Your willingness to show proof of funds
- Sending a personal letter to the seller talking about why you want the property
How Do You Make an Offer in a Competitive Market?
There are several steps that you need to take before you can make an offer in a competitive market. The first, and arguably most important one is to get pre-approval for a mortgage. Without one, you don’t know exactly how much you can offer to purchase the property that you have your eyes on. And without one, no seller or real estate agency will take you seriously.
Once you have your mortgage pre-approval, there are several steps that you need to follow if you want to be the one that buys the property. They include:
- Act quickly
- Be flexible
- Offer a strong first offer
- Work with an experienced property agent
- Limit the number of contingencies
- Send a personal letter
The Best Way to Approach a Bidding War for a Property in London
Entering a bidding war is not a fun experience as it can be quite stressful and tricky to navigate. Fortunately, there are some best practices that you can follow when entering a bidding war for a property. They will ensure that you don’t spend more money than you have to and will make the whole process much smoother. Some of these best practices include:
Be Financially Prepared
Before you enter a bidding war, make sure you have a mortgage pre-approval. That way, you’ll know exactly how much you can afford to spend on your new home. A mortgage pre-approval letter demonstrates to the seller that you’re a serious and qualified buyer.
Set a Budget
Before entering a bidding war, set a budget that you’re going to stick to. That way, no matter what happens, you won’t spend more money than you’re willing to. The last thing you want is for you to buy your dream home, which will soon become a financial burden.
Work With an Experienced Agent
Working with a professional that knows the market where the property is located is key. They can advise you accordingly both in terms of bidding and at what point you should pull out of the bidding war as it no longer makes financial sense to keep going.
Be Flexible & Move Quickly
Flexibility and speed are essential when you’re in a bidding war with multiple other interested buyers. If the seller wants to sell their house fast, they won’t wait around for you to make your mind up. And truthfully, why would they when there are people willing to buy the property right now, no matter what.
Include an Escalation Clause
If you want to move faster during a bidding war without being directly involved in the bidding process, include an escalation clause. This clause will automatically bump up your offer by a specified amount up to the predetermined amount of money you’re willing to spend if a higher offer is presented on the table.
Becoming a standout buyer in the London property market is tricky. Oftentimes, there are dozens of people interested in every property that is listed on the market. So, you’ll have to take some extra steps in order to become more appealing to sellers and for them to take you seriously. Hopefully, after reading this article, you’ve gotten all of the information that you’ll need to get out there, and find, and become the owner of your dream home in London.