Video: Bidding process: How to negotiate the price of your property upwards

The bidding process is one possible strategy for negotiating the purchase price with selected prospective buyers. This method offers both sides greater negotiating leverage. When is it worthwhile to use the bidding process, and what is important for owners in this process?

The seller can either plan the bidding process as part of their pricing strategy from the outset or integrate it into the negotiation phase later if there are more inquiries than expected. This process differs from a traditional auction. The highest bidder is not necessarily guaranteed the property. Nor is the seller obligated to accept bids that are too low. If none of the submitted price expectations are acceptable, the owner is free to decide against the sale and to resume the search for suitable buyers. The bidding process strengthens the seller's negotiating position.

Private sellers should have a professional, market-based property valuation carried out before opting for this negotiation method. Without a true understanding of their property's market value, they won't know if potential buyers' bids are below the actual market value.

Another danger lurks in the competition between prospective buyers. Those who want the property but lose sight of their own budget can cause problems for the seller later on. If the purchase agreement is reversed, the search starts all over again. Therefore, it is not always advantageous to accept the highest bidder.

The professional bidding process is conducted by a real estate agent who first performs a market-based valuation of the property. The agent also brings their experience and negotiation skills to the bidding process and can assist owners in selecting a buyer.

More information about the bidding process and its implementation can be found in our video.