How to win a bidding war on an in-demand house, according to real-estate mogul Barbara Corcoran

Despite a sharp rise in the 30-year mortgage rate to nearly 7%, buyers aren’t able to catch a break, due to a shortage of listings. Competition for homes is intensifying, and the data indicate that “housing has returned to a seller’s market,” Zillow
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said in a recent report. New listings were down 28% in April as compared with April 2022, the company noted.

“Two out of three houses in America are going to bidding wars,” Corcoran said in a “Good Morning America” appearance.

“If you want to win a bidding war, you have to look like the best deal in town, and here’s what you ought to do: You’ve got to be prequalified for your mortgage so you can go in there as an all-cash deal,” the founder of real-estate firm The Corcoran Group and “Shark Tank” investor said in response to a viewer question. She sold her real-estate company to NRT for $66 million.

“It’s not contingent, [and I’ve] already got my mortgage — you want that power behind you,” she continued. Having no contingencies refers to buyers not having clauses in offers that state specific conditions to be met before the deal closes, such as the sale of a current home. If an accepted offer includes contingencies and they’re not met, the would-be buyer can walk away without any repercussions. 

“Make sure you have no contingencies, [and] make sure you give your best bid upfront because you don’t want to say, ‘I would have bought that house if I hadn’t lost it for $10,000,’ ” Corcoran said.

But winning a bidding war can go beyond financial considerations into emotional ones, the real-estate tycoon observed. “You also want to go in and realize it’s never just a financial deal,” Corcoran added. “Get a nice piece of stationery and handwrite a note to that owner and tell them how much you love the house. It makes a difference because people like to sell homes to people who love their house.”

Still, she said, even amid stiff competition for minimal inventory and with mortgage interest rates considerably higher than had been seen since the 2008–09 financial crisis, the deck is not as stacked against buyers as it might seem.

“But it’s a great time to buy a house,” Corcoran said, “because the minute interest rates go down, you’re going to compete with every Tom, Dick and Harry out there, and prices are going to shoot up.”