Making offers in the current climate

ntlbell

hi,

Just wondering in general what offers are people making.

I've called a few EA's on some 2 bed apt's around the Dublin area and in most cases I'm offering 20-25% off the asking and I'm being laughed at :mad:

What are others offering out there?

starky

ntlbell wrote: »

hi,

Just wondering in general what offers are people making.

I've called a few EA's on some 2 bed apt's around the Dublin area and in most cases I'm offering 20-25% off the asking and I'm being laughed at :mad:

What are others offering out there?

They wont be laughing at you in six months ;-) ....
what kind of price range are you talking about?

ntlbell

starky wrote: »

They wont be laughing at you in six months ;-) ....
what kind of price range are you talking about?

I've made a few cheeky attempts at 30% on anything over 350k

and 20-25% on 300-350 I'm really just testing the waters.

nothing tho.

Ste.phen

I imagine most people selling apartments in Dublin CC are investors who want to get out due to the interest rate rises, and will be very reluctant to accept anything that makes their current *potential* loss a little more real.
That said, nobody seems to be buying either, so something has to give.

jetski

well fair play to you, 30% is alot but could you imagine you got a call back one day?

The_Conductor

The simple fact of the matter is that prices, particularly of apartments, are pretty much falling on a daily basis (houses are holding their value a lot better). What may appear to be a ridiculous offer today on a 2 bed apartment, could actually look very expensive before too long.

I'd be inclined to agree with another poster on this thread regarding a lot of the apartments possibly being offered by investors who really haven't registered the difficulties the market is in. A second hand apartment is worth less to a FTB or even a non-ftb as the stampduty implications, along with other factors, mean its purchase cost has a lot of hidden extras which you might not immediately think of. New apartments are going down remarkably in price- the investors are not yet matching these falls- they will have to.

I think you are being quite reasonable with your methods at the moment- offering 20-30% less than asking. Are you seriously in the market for one of these units though- when an EA eventually relents (and they will eventually) are you happy to follow through on the offer?

S.

johnnyskeleton

In the Irish Times property section yesterday, someone was complaining that they made offers of 20% below asking and the Estate Agent wouldn't even put the offer to the vendor.

Given that prices have fallen by at least 8.8% (a conservative estimate), 20% off the asking price is probably just below the market value, and given that prices are probably goning to go down, I think it is a realistic offer.

Them laughing at you is probably a tactic, and if you get laughed at enough you will find someone who will face the reality of prices.

knighted

Igy wrote: »

I imagine most people selling apartments in Dublin CC are investors who want to get out due to the interest rate rises, and will be very reluctant to accept anything that makes their current *potential* loss a little more real.
That said, nobody seems to be buying either, so something has to give.

i think its quite the opposite -investors are now buying believe it or not albeit very quitly-in the course of my business i come into contact with many landlords and investors and one in particular has just snapped up 15 apartments ,when i asked why in this climate i was informed that the rents have never been so high so was good business now ,he reckoned investors needed the slump to reorganise thier portfolio finances and refinance to free up equity in existing properties to be in a positon to reinvest shortly when interest rates come back down ,but rents never will fall -it seems it will be win win all the way for astute investors who understand long term financing -

ntlbell

smccarrick wrote: »

I think you are being quite reasonable with your methods at the moment- offering 20-30% less than asking. Are you seriously in the market for one of these units though- when an EA eventually relents (and they will eventually) are you happy to follow through on the offer?

S.

Yes I'm looking at a long term investment and if I got a response from these partiular ones which are in an area I'm looking to get into I'd be happy to get in now at 30%

Maybe I'm jumping the gun and should just hold off and see how the land lies in a years time

Supercell

knighted wrote: »

,he reckoned investors needed the slump to reorganise thier portfolio finances and refinance to free up equity in existing properties to be in a positon to reinvest shortly when interest rates come back down ,but rents never will fall -it seems it will be win win all the way for astute investors who understand long term financing -

I hope you are not taiking up his advice :-

1) Interest rates, if anything, look more likely to rise than fall

Bloomberg
"Growth is ``fundamentally robust'' and the ECB ``will act'' if its price-stability goal is threatened, Weber said. Consumer prices rose 3.2 percent in February and three German states said today that inflation increased this month.
ECB council member Axel Weber said in Luxembourg today there may be a greater case for raising rather than cutting rates."

2) Rents are falling not rising, though evidence of that is largely anecdotal the guys on the propertypin rental forum would appear to be finding no end of places with dropping rentals , something that would have been as unthinkable as falling house prices a year or two ago.

Its time to get out, not pile in more!!

jmayo

knighted wrote: »

i think its quite the opposite -investors are now buying believe it or not albeit very quitly-in the course of my business i come into contact with many landlords and investors and one in particular has just snapped up 15 apartments ,when i asked why in this climate i was informed that the rents have never been so high so was good business now ,he reckoned investors needed the slump to reorganise thier portfolio finances and refinance to free up equity in existing properties to be in a positon to reinvest shortly when interest rates come back down ,but rents never will fall -it seems it will be win win all the way for astute investors who understand long term financing -

At last someone sees the market for what it really is and has grasbed the bigger picture. Now is the time to invest, particularly in apartments.
They are definetly going to rise in value over the next year and renting them out will be no problem in the future.

BTW have you or your friend thought about buying in Basra?
If so, please give me a call as I know a few upmarket places going cheap at the moment. The little unrest there at the moment is being blown out of all proportion.

I reckon there is going to be a big uptake for great short term rentals from visiting coalition dignataries, oil executives in the next couple of years, so it is a great time to get into a new untapped market.
Be the first Irish person in, not the last and thus make a killing

meesa

knighted wrote: »

i think its quite the opposite -investors are now buying believe it or not albeit very quitly-in the course of my business i come into contact with many landlords and investors and one in particular has just snapped up 15 apartments ,when i asked why in this climate i was informed that the rents have never been so high so was good business now ,he reckoned investors needed the slump to reorganise thier portfolio finances and refinance to free up equity in existing properties to be in a positon to reinvest shortly when interest rates come back down ,but rents never will fall -it seems it will be win win all the way for astute investors who understand long term financing -

This is a wind-up...please tell me it is...:pac::pac::pac::pac::pac:

meesa

ntlbell wrote: »

hi,

Just wondering in general what offers are people making.

I've called a few EA's on some 2 bed apt's around the Dublin area and in most cases I'm offering 20-25% off the asking and I'm being laughed at :mad:

What are others offering out there?

NTLbell, you might be very sorry if someone does accept your 20/25% below bid when this time next year they could very well be 50% below the present RIDICULOUS asking price! Apartments have a LONG way to drop.
Just my opinion but that is what these boards are for and I have called the market spot on thus far and made a tidy profit.....don`t get in now!

Tom123

knighted wrote: »

i think its quite the opposite -investors are now buying believe it or not albeit very quitly-in the course of my business i come into contact with many landlords and investors and one in particular has just snapped up 15 apartments ,when i asked why in this climate i was informed that the rents have never been so high so was good business now ,he reckoned investors needed the slump to reorganise thier portfolio finances and refinance to free up equity in existing properties to be in a positon to reinvest shortly when interest rates come back down ,but rents never will fall -it seems it will be win win all the way for astute investors who understand long term financing -

Are you serious?

What Canny McSavy investors believes it is a good time to add more assets to they portfolio that yield less than the risk free rate that are currently falling in value all in the middle of a global credit crunch!

bobbysands81

Went sale agreed this week at my current asking price, which was 5% down on my original price - had a bit of interest from others, including offers and had a good few viewings in the last few weeks and had to cancel others after going sale agreed.

I don't know if this is an indicator of the market picking up or the traditional Spring market just starting but from someone who now has no interest what happens the market I don't think it's as bad for places close to Dublin City Centre as the prophets of doom and gloom make out.

I needed a quick sale so I was delighted to achieve only 5% below my original asking price. Less than 2 months on the market, I think I would have been able to push for me if I wasn't in a rush.

This is just my anecdotal evidence.

beeno67

There is no harm offering 20-30% below the asking price but you have to be realistic. You may believe that properties are going to drop that amount but that is not the current market value. This is all part of the speculation. If you believe that next year prices will have dropped 30% then I am afraid you will have to wait a year to get that price. In other words, if the market was rising and a property was valued at 300,000. How would you react if the estate agent said "I believe next year the house will be worth 30% more so I am going to charge €390,000. I bet you would have laughed at him. Buying now is a risk, you cannot expect the seller to take the hit now and remove the risk from you. If you are right about house prices then just wait a year.

The_Conductor

bobbysands81 wrote: »

I don't think it's as bad for places close to Dublin City Centre as the prophets of doom and gloom make out.

I needed a quick sale so I was delighted to achieve only 5% below my original asking price. Less than 2 months on the market, I think I would have been able to push for me if I wasn't in a rush.

This is just my anecdotal evidence.

Nice one Bobby for getting your sale. It is entirely as you suggest though- location dependent. There hasn't been a lot of development in Dublin city centre- so there will ordinarily be at least a background level of interest in any property that comes up- particularly if its competitively priced. Once you leave the 1 mile radius from O'Connell Street Bridge for apartments and about 4-5 for houses, its a different situation however. I suppose its a waiting game for most people- both buyers and sellers- see how the dust settles down.