Is it a good idea to bid higher on a property?
In a tight real estate market like Paris, some buyers consider bidding higher to win a property. This practice raises both hopes and questions: is it legal? Does it pay off? At what point does it become risky? Here's an overview of the issues involved in outbidding, from strategy to legal framework and economic common sense.
A market where competition drives up prices
In sought-after neighborhoods of the capital or in cities such as Bordeaux, Lyon, and Annecy, it is not uncommon for a property to attract numerous viewings as soon as it is listed. When it meets many criteria—a good address, no work needed, high floor, old-world charm, or a beautiful view— it can quickly attract several offers at the asking price, sometimes within the first 48 hours.
In this context, some buyers do not hesitate to offer a price higher than the asking price to get ahead of their competitors. This is known as overbidding. But contrary to popular belief, this does not guarantee priority or even the success of the transaction.
Bidding wars: what does the law say?
First essential clarification: in real estate sales between private individuals, if a real estate agency is handling the transaction, there is no legal obligation for a seller to accept the first offer, nor the highest. As long as the promise or preliminary sale agreement has not been signed, they are free to choose the buyer with whom they wish to conclude the sale.
However, once they have accepted a written offer, they are legally bound to the buyer. They can no longer accept another offer, even if it is higher. In practice, some sellers deliberately wait for several offers before choosing one.
Therefore, outbidding is only relevant if no offer has yet been accepted and if the seller deliberately allows competition to play a role.
The motivations of those who outbid
Offering more than the asking price can be a deliberate strategy, particularly in two cases:
- Strong emotional attachment or rare opportunity: a buyer may want to secure the sale quickly. The most common case is when several offers at the asking price have been made. This becomes an effective way to stand out.
- Rental investment with high profitability despite a price slightly above market value.
Some very solvent buyers (foreign buyers, professionals, or buyers without a loan) know that speed of execution and price can tip the balance.
In this case, outbidding is part of a strategy to position oneself against other equally solid offers.
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Risks that should not be overlooked
Overpaying for a property nevertheless carries several real risks:
1. Potential depreciation on resale
Buying too high can make it difficult to resell without losing money, especially if the market stabilizes or declines. This is a real issue in a context of rising interest rates and market correction.
2. Panic or misplaced pride
In a competitive environment, it is tempting to want to “win” at all costs. But real estate is not a competition: the only good price is the one you are willing to pay without regret in 5 or 10 years. It is essential to remain clear-headed and rational.
Our advice if you are considering bidding above the asking price
If you find yourself in a tense situation and are considering offering more than the asking price, here are a few pointers:
- Find out exactly how much per square meter properties are selling for in the neighborhood to avoid overpaying. The services of a real estate hunter such as Parlez-moi de Paris are invaluable for this detailed analysis.
- Objectively analyze the qualities of the property: orientation, work to be done, co-ownership, floor, potential nuisances, etc. Does it really meet all your long-term criteria? How rare is the property? Will you have to start a long search again to find a similar property?
- Calculate how far you are willing to go, leaving a margin for notary fees, renovations, or any unexpected bank charges.
- Don't rely on the assumption that you will make a quick profit on resale. Paying a little too much is only acceptable if you plan to keep the property for the long term.
- Finally, be transparent with the seller and the agent: a well-argued, clear offer with no conditions precedent can carry more weight than a vague bid.
As property hunters, our opinion
At Parlez-moi de Paris, we deal with tense sales every week. Our role is precisely to avoid unnecessary bidding warsby giving you access to properties before they are publicly advertised, or by enhancing your application so that you are chosen, even without offering more.
Bidding higher can sometimes be a lever, but it should never be the result of improvisation or panic. It is much more effective to prepare in advance, be responsive, well advised, and strategic. It is our job to help you do that.
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We can only recommend and advise Parlez-moi de Paris for your real estate searches. We contacted them in September 2024 and our interlocutor, Olivier, was able to understand our request and refine our search criteria. He has shown patience and commitment to our project and thanks to him we have an apartment that we would not have had access to without his network and his knowledge. Thanks to Olivier and to the Parlez-moi de Paris team.
After having had a very disappointing experience with an apartment hunter for a year, given that we live abroad, in February I contacted “Parlez-moi de Paris” and from the first meeting with Susan we were reassured and comforted! And already in June, we signed the bill of sale! She immediately identified our priorities and needs, she has a gift for listening and feeling the other person. Very responsive, always available, calm and very professional, she accompanied us in all the procedures with the notary and even showed us the neighborhood that we did not know at all! A very nice experience!
I had the opportunity to collaborate with Suzan on two common issues and everything went well. She was very involved, available and efficient from start to finish, resulting in a smooth and timely transaction. It is a real pleasure to work with such a serious professional, whom I highly recommend!
