Should I Include an Escalation Clause in My Offer?

When you put an offer in on a house right now, you can already assume that there will be multiple offers on the table. Because of this, your Realtor® may recommend including an escalation clause to the contract. What exactly is an escalation clause? 🤔

An escalation clause may be written into a real estate contract when you’re expecting multiple offers. Think of it like eBay… but for home buying. 🦗🦗🦗 Stay with us here. 

Let’s say you are offering $350k on a home and someone outbids you and offers $355k. The escalation clause will state that you are willing to go $1k, $5k — whatever you and your Realtor® decide — higher than the highest bid on the table, not to exceed $380k, or whatever your cap is. This ensures that you won’t be outbid. That is, of course, unless the offers skyrocket out of your budget. But it takes the bidding war and the back and forth out of the process.

Of course, there are downsides to everything; for example, the seller knowing upfront that you’re willing to pay more than what you offered, so are the other offers on the table legit? There are ways to make sure that you’re not being taken advantage of, like including in the contract that all other offers must be disclosed by the seller’s agent. But again, your Realtor® will be able to “read the room,” so to speak, and guide you in that process.

If you’re in the market to buy, you’ll want to go in strong with a pre-approval in hand so you know exactly how much you can offer and where your cap should be. Visit to get started. We’d love the opportunity to be a part of your home buying journey.