In a competitive housing market, the way you structure your offer can make all the difference. When homes are receiving multiple offers within days—or even hours—buyers need to be strategic. One option that can give you an edge without overextending your budget is something called an escalation addendum.
We asked Maya, one of our agents here at The Nickley Group, to share one of her go-to tools in a bidding war. Her answer? Escalation addendums.
How an Escalation Addendum Works in Real Estate
Let’s say you’re interested in a home listed at $300,000. You’re ready to offer that full price—but you know there are several other buyers putting in offers too. Instead of blindly guessing how high to go, you can include an escalation addendum with your offer.
This allows you to say:
“We’re offering $300,000, but we’re willing to increase our offer up to $310,000 if necessary, and we’ll beat the next highest offer by $2,000.”
If someone else offers $305,000, your offer would automatically escalate to $307,000. But if no one else goes above your original offer, you stay at $300,000.
This approach keeps you competitive without going straight to your highest number.
Why Maya Loves Escalation Addendums
It gives buyers a chance to stay in the game—without blowing the budget. You’re only increasing your offer if you need to, and you get to set the cap and the increment. That flexibility is key when homes are flying off the market.
Maya calls it a “blind way of trying to beat someone else out” while still putting your best foot forward. It lets buyers feel confident that they’ve stayed competitive without overpaying.
When to Use an Escalation Addendum in Real Estate
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Not every seller accepts escalation clauses, so your agent will help determine if it’s the right move.
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Most escalation addendums require written proof of the competing offer to escalate.
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You control how much you’re willing to escalate and by what amount.
If you’re unsure when it’s appropriate to use one, a professional REALTOR® can guide you through it. You can read more about how to make a strong offer in our seller insights blog.
Pros and Cons of Escalation Addendums
Pros
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Keeps your offer flexible and competitive
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Sets a max budget from the start
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Increases chances of winning in multiple-offer situations
Cons
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May be rejected by the seller
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Not always effective in all markets
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Requires clear documentation of competing offers
Final Thoughts
Escalation addendums aren’t used in every deal, but when they’re the right fit, they can help buyers stay competitive without exceeding their budget. It’s just one of the many strategies our agents use to help clients win in today’s market.
If you’re planning to buy a home in Central Florida, connect with our team to find out how we can tailor your offer strategy.
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Maya Gorney, REALTOR®
607.227.5536
[email protected]