Bidding, why it's good to know who you're bidding against

Are you thinking of bidding on a property?

Are there other bids on that property?

If so ,I advise you to get a good sense of who these other bidder/s are with a view to determining how they rank against you in terms of strength.

Let's say we can rank bidders in three ways according to strength.

1. The cash buyer.
The cash buyer / bidder is the most powerful competition you can have. This is because the cash bidder is completely independent of third parties such as banks, bank valuers and life insurance companies. The cash buyer makes 100% of the decision and doesn't need to get the approval of anyone else. They can act fast because of this.
Even if the cash buyer offers less than another bidder, it's possible that their offer will be accepted just because the cash buyer can act quickly and independently.

2. The loan approved buyer / bidder.
This bidder has current loan approval in place. These bidders don't have the same level of autonomy as cash buyers. They are subject to a bank valuer confirming the value of the property, to the need to get approved for life insurance as mortgage protection and to the smooth issuing of a loan offer by the bank. In my experience there can be significant delays and sometimes a complete failure of "loan approval" to convert into actual funds.
The loan approved bidder may need to outbid a cash buyer a significant amount in order to the preferred bidder.

3. The bidder who is subject to the sale of their property.
In this "sellers" market, where there are more buyers than properties to buy, this kind of bidder is likely to be considered a weak bidder. However it depends on how far advanced the sale of their property is. If they've just put their home on the market and need to sell it in order to fund the purchase of their next home, then they are weak bidders. However if they have already found a buyer for their property, have issued contracts to that buyer and the buyer has signed a contract, then they are likely to be considered as a valid bidder.
However many people who need to sell a property in order to fund a purchase are also getting some type of mortgage too. If this is the case then this bidder will definitely be considered as the weakest bidder given how many moving parts need to move smoothly for them to successfully fund a purchase.
This kind of bidder may not be entertained at all as a valid buyer by selling agents, particularly in this market where sellers tend to have their pick of buyers.