Business

Buyers turn to new bidding tactic in hot home market

Katrine and Stephen Campbell bought this house using the tactic.
Katrine and Stephen Campbell bought this house using the tactic.Katherine Taylor for The Boston Globe

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Katrine and Stephen Campbell were up against daunting competition from 10 other bidders for the Reading house they wanted to buy. So the couple decided to make no specific offer at all, but promised to top whatever turned out to be the high bid by $5,000.

The increasingly popular tactic, known as an escalation clause, worked and the Campbells bought the four-bedroom home late last year for $597,000 — above the high bid as promised and $18,000 more than the original list price. “We made only one offer — and we got it,” said Katrine Campbell. “The escalation clause gave us an edge.”

In a sign of how competitive the Boston-area housing market has become, the potentially risky tactic is becoming part of the area’s bidding war landscape, brokers and other real estate executives say. Some report a level of escalation clause activity unseen since the last house-buying frenzy 10 years ago.

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