My property wasn't shifting so I dropped the price down to below the average, which prompted a huge influx of interest - now I have people vying for it, with a few people offering to pay over the asking rent. I’ve whittled the prospective applicants down to five potentials, all of whom – on paper – look great. Can I go to ‘sealed bids’, in the same way that you can when you are selling?
In short, yes you can, although you must make sure that you are completely open and honest to everyone involved from the start about what you are doing – understandably some people may not wish to get involved in it, and may remove themselves from the bidding.
Under normal circumstances, you or your agent, can request the amount the person is willing to pay and their circumstances – although it sounds like you already have much of these details. In your situation, it would be a case of formalising the financial offers. It would be wise to set a time frame for the offers to be submitted by so you have set time upon which you can make a final decision. At this stage, you should hold firm, and not accept any late entries – fair is fair!
It is important to remember though, it is not always the person who is able to pay the most that is the best option as a long-term tenant. Whilst it goes without saying that you want to achieve the very best price for your property, be aware that you had to drop the price for your property to gain interest. The tenants that you now have on the line did not show any interest when the property was advertised at the higher price, which might suggest that they couldn’t afford the rate. Pushing the price up through bidding wars may result in your eventual tenant agreeing to a price higher than they can comfortably afford - which may leave you both in an uncomfortable situation further into the tenancy.
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