Sealed bids are becoming increasingly common in the Bristol Residential market; particularly as Vendors are experiencing high levels of demand in the City. Previously more common in the London market, Bristol has performed remarkably well over the past few years; figures show that prices in most prime parts of the city are growing fast – By 3.1% so far in 2016 according to one local agent.
Part of the reason for this is the high level of demand for property – when a good property comes to the Bristol market and is priced reasonably, more often than not there is a queue of buyers – Vendors are beginning to take advantage of this by attempting to maximise the selling price and going to sealed bids.
It is well-known practice in some parts of Bristol, for example, for a new property which is sensibly priced to attract in excess of 20 (sometimes double) viewings over the first few days of it being on the market; often resulting in numerous offers over the asking price. Accordingly, agents are advising their clients to proceed to sealed bids.
In short, sealed bids are part of a concealed auction in which interested parties will submit their best and final price to the vendor (or indeed estate agent, if one has been appointed) by a deadline given. These will then be considered by the vendor and one buyer is selected to move forward with the property purchase.
This process, whilst deemed to be the fairest way of finding the best bid or bidder within a prescribed timeframe, is essentially a ‘lottery’ for all parties concerned. You usually need to decide what you are prepared to pay for the property, which by this stage is normally above the threshold asking price. You must also try to ‘guess’ at what level the other parties are going to pitch at and choose whether to pay a possibly inflated amount in order to have a chance of winning the process.
However, when it comes down to sealed bids, it is not always the case that the property is sold to the highest bidder. In examples where bids have been close, we have found that the vendor will not necessarily favour the highest bidder, but instead will often prefer the bidder who looks most likely to proceed to exchange and onto completion.
In instances like these, a carefully planned and worded offer letter is of the utmost importance in maximising the chances of being selected, and proven representation from a professional further increases the success rate. Garrington has often been involved in sealed bids scenarios and has used their expertise to increase a buyer’s chances, whilst not necessarily paying the highest price. Vendors often look favourably upon property finder clients (using Garrington) as they know they are genuine buyers who have engaged the services of a professional organisation to support their purchase.
If you are considering a sealed bid in the Bristol market, contact Garrington Property Finders today to find out how we can assist you in purchasing your dream property.