Offer prices

Da GOAT · 09-01-2010 8:25pm #1

Hi Im looking to buy a house but having trouble thinking of a good first initial offer value. The house is valued at 310k and nice house nice area.

Obv this is slightly a general question but anyone have advice on making offers.

francish · 09-01-2010 9:12pm

It would help if you provided link to house or some details (e.g 3 modern bed semi-detached in Santry).

Tipsy Mac · 09-01-2010 9:17pm

They will take your arm off for €300k, I'd start a bid of €275k and see what response you get back. Price similar properties in the area, it's possible it's way overpriced to start with.

Da GOAT · 09-01-2010 9:24pm

3 bed semi d in firhouse.

Rory1 · 09-01-2010 9:40pm

Who valued it at €310k? Is this the asking price?

stepbar · 09-01-2010 9:47pm

Tipsy Mac wrote: »

They will take your arm off for €300k, I'd start a bid of €275k and see what response you get back. Price similar properties in the area, it's possible it's way overpriced to start with.

You'd stsrt at 275k? Really?

What planet are you living on?

It's worth at a push between 180k - 220k based on a rent of c1k - 1.2k p.m. And even at that you're paying the full economic value, which for something that is second hand is probably not advisable.

Rory1 · 09-01-2010 9:58pm

stepbar wrote: »

You'd stsrt at 275k? Really?

What planet are you living on?

It's worth at a push between 180k - 220k based on a rent of c1k - 1.2k p.m. And even at that you're paying the full economic value, which for something that is second hand is probably not advisable.

Agree. €220k would be the max I would pay.

Senna · 09-01-2010 10:00pm

stepbar wrote: »

And even at that you're paying the full economic value, which for something that is second hand is probably not advisable.

What has second hand got to do with it?

the_syco · 09-01-2010 10:15pm

Senna wrote: »

What has second hand got to do with it?

Brand new houses have gone for that price. You can't really sell a 2nd hand house for the same as a new house, IMO.

Victor · 10-01-2010 12:07am

Transaction charges (primarily stamp duty) aside, of two comparable properties, the second-hand / slightly older one will invariably get a better price as there is generally less risk with it.

Da GOAT · 10-01-2010 11:51am

im a first time buyer so stamp isnt an issue. it is second hand. im surprised you would offer so little and no be willing to actually pay more than 220k. could you give me some more insight into why so low.

Tipsy Mac · 10-01-2010 12:39pm

stepbar wrote: »

You'd stsrt at 275k? Really?

What planet are you living on?

It's worth at a push between 180k - 220k based on a rent of c1k - 1.2k p.m. And even at that you're paying the full economic value, which for something that is second hand is probably not advisable.

At the time I made my post I was unaware of the house's location or size. It could have been a 12 bedroom house in the middle of Leitrim which cost€300,000 in materials to build :rolleyes:

Rafa1977 · 10-01-2010 1:13pm

stepbar wrote: »

You'd stsrt at 275k? Really?

What planet are you living on?

It's worth at a push between 180k - 220k based on a rent of c1k - 1.2k p.m. And even at that you're paying the full economic value, which for something that is second hand is probably not advisable.

Would agree with above post, offering 275k!!!!. Go and offer as low as you can, I think maybe 200k, you can always up your offer. With 275k they will probably have the contract ready for you there and then.

Freddie59 · 10-01-2010 2:11pm

Da GOAT wrote: »

im a first time buyer so stamp isnt an issue. it is second hand. im surprised you would offer so little and no be willing to actually pay more than 220k. could you give me some more insight into why so low.

Have a visit to these sites:

www.thepropertypin.com
www.irishpropertywatch.com
www.irishhousehunter.com

Then decide. There is a HUGE way to go in house price falls. It is inevitable.

We purchased in August. Three houses, same area (100 homes), one on at €299k, one at 287k, and one (the one we bought) on at €195k (executor sale). We got it for €175k.

See where this is going? As a first time buyer, you have enormous power and choice at your disposal. Savings like this can mean the difference between a 20-year and a 40-year mortgage. Don't do it.

nice1franko · 10-01-2010 2:49pm

what does 'executor sale' mean?

edit - sry, googled it... http://www.thepropertypin.com/viewtopic.php?f=10&t=16963&start=0

Da GOAT · 10-01-2010 8:34pm

been readin links, damn i know very little about the property market. thx a mill guys.

bbbbb · 10-01-2010 9:16pm

You need to find out what simliar property was selling for in 2000/2001.
The asking price could be 2006 aspirational, could have a 20% margin factored in, or could be "priced to sell".

spockety · 10-01-2010 9:19pm

I presume this is the house you're looking at?

http://www.daft.ie/1492317

You can rent this type of house in that area for 1,000 per month.

http://www.daft.ie/2799201

Annual rent of 12,000 by 14 gives you a valuation of €168,000.

This type of house may yet end up there. In the current market I'd say this is worth at most 250k. At the height of the madness they were going for about 450k, though this should not be a reference.

Fortunately for the vendor, there are still some people out there like yourself who will see 300k for this house as being good value, and I would imagine they will be able to sell for 280-300 in the next few months.

spockety · 10-01-2010 9:31pm

bbbbb wrote: »

You need to find out what simliar property was selling for in 2000/2001.
The asking price could be 2006 aspirational, could have a 20% margin factored in, or could be "priced to sell".

In July 2001, Sherry Fitzgerald had 23 Daletree View on the market for £166K, or €210

In October 2001, REMAX had a 3 bed semi in Daletree Drive on the market for £175K or €222K.

Da GOAT · 10-01-2010 9:54pm

damn thanks for the effort you put in there. 00/01 obv is pre boomish times to compare too.

thx guys, prob saved me a packet already.

Victor · 10-01-2010 9:58pm

Da GOAT wrote: »

damn thanks for the effort you put in there. 00/01 obv is pre boomish times to compare too.

No, its more mid-boom, when the government removed tax relief for commercial investors for residential property.

spockety · 11-01-2010 12:25am

Da GOAT wrote: »

damn thanks for the effort you put in there. 00/01 obv is pre boomish times to compare too.

thx guys, prob saved me a packet already.

Please don't base such a massive decision on what you read on message boards. Some would argue against the valuations i have given. Do your own research and see what conclusions you come to!

warrenaldo · 11-01-2010 4:42pm

If its the right house for you at the right time then I say buy. Some people cannot sit and wait.

Regarding what to offer - I would personally go no higher than 280k. But I would start around the 260k mark.

Most sellers wont accept 20%+ from the asking price.

Senna · 11-01-2010 5:33pm

warrenaldo wrote: »

Some people cannot sit and wait.
.

A few people might not be able to wait, however the majority are just wanting to buy now because they can and they like the idea of owning a house, there are very few reasons to HAVE TO BUY NOW.

spockety · 11-01-2010 5:39pm

I fear that most people put more thought and research into buying a flat screen TV than they do into buying a property.

:eek:

Omnipresence · 11-01-2010 5:50pm

spockety wrote: »

I fear that most people put more thought and research into buying a flat screen TV than they do into buying a property.

:eek:

how true...

I have a good friend who just bought a house that was advertised for around 700k for 350k .. i know its apples and oranges so forget about the valuations an price paid but look at the exchange from his point of view:

him: i'll offer you 300 (chancing his arm)
them: no way
him: i'll give you 350, final offer you have 24 hours to decide
them: done

Times they have a changed !

Use the fact that its a buyers market to your advantage !!

My personal belief is that now is a good time to buy.
Are house prices going to fall - yes and a bit too (fact) BUT interest rates will soon start to rise (fact) - but any reduction in house prices now will be eaten up by interest rates so now could well be the best time to buy

spockety · 11-01-2010 5:55pm

Omnipresence wrote: »

how true...

I have a good friend who just bought a house that was advertised for around 700k for 350k .. i know its apples and oranges so forget about the valuations an price paid but look at the exchange from his point of view:

him: i'll offer you 300 (chancing his arm)
them: no way
him: i'll give you 350, final offer you have 24 hours to decide
them: done

Times they have a changed !

Use the fact that its a buyers market to your advantage !!

My personal belief is that now is a good time to buy.
Are house prices going to fall - yes and a bit too (fact) BUT interest rates will soon start to rise (fact) - but any reduction in house prices now will be eaten up by interest rates so now could well be the best time to buy

Umm. That doesn't make much sense. If you buy at today's prices on a variable rate mortgage, you're going to be affected by the interest rate rises.

If you buy after more price drops, the same applies, though you will still be paying back less than you would have if you bought today.

Besides which, one of the key factors in property pricing is the credit market. Start jacking up interest rates and watch what happens to property prices......

stepbar · 12-01-2010 12:07am

Omnipresence wrote: »

how true...

I have a good friend who just bought a house that was advertised for around 700k for 350k .. i know its apples and oranges so forget about the valuations an price paid but look at the exchange from his point of view:

him: i'll offer you 300 (chancing his arm)
them: no way
him: i'll give you 350, final offer you have 24 hours to decide
them: done

Times they have a changed !

Use the fact that its a buyers market to your advantage !!

My personal belief is that now is a good time to buy.
Are house prices going to fall - yes and a bit too (fact) BUT interest rates will soon start to rise (fact) - but any reduction in house prices now will be eaten up by interest rates so now could well be the best time to buy

Where was the house and how much would it rent for?

Da GOAT · 13-01-2010 1:11pm

spockety wrote: »

I presume this is the house you're looking at?

http://www.daft.ie/1492317

You can rent this type of house in that area for 1,000 per month.

http://www.daft.ie/2799201

Annual rent of 12,000 by 14 gives you a valuation of €168,000.

This type of house may yet end up there. In the current market I'd say this is worth at most 250k. At the height of the madness they were going for about 450k, though this should not be a reference.

Fortunately for the vendor, there are still some people out there like yourself who will see 300k for this house as being good value, and I would imagine they will be able to sell for 280-300 in the next few months.

You seem to know your stuff, I was considering bidding 200k initially if I was to make an offer (still looking to view other similiars in firhouse). Would even €180k be too low, id say 180k will be a big fat no intially but will give me more room to manuover. Since you figure 250k being the top of the range then i should try to buy for like 230k. Id prob be delighted to get it for 230k to be honest.

My mainn question for this post is; With your rental valuation of €168,000. Why have the EA valued at €310,000. I understand rental valuation isnt the only key point BUT the market/buyers say its worth circa 230k. Are EA full of ****e and the prices AE provide are not realisitic and expect buyer to offer way way less.

spockety · 13-01-2010 3:33pm

Da GOAT wrote: »

You seem to know your stuff, I was considering bidding 200k initially if I was to make an offer (still looking to view other similiars in firhouse). Would even €180k be too low, id say 180k will be a big fat no intially but will give me more room to manuover. Since you figure 250k being the top of the range then i should try to buy for like 230k. Id prob be delighted to get it for 230k to be honest.

My mainn question for this post is; With your rental valuation of €168,000. Why have the EA valued at €310,000. I understand rental valuation isnt the only key point BUT the market/buyers say its worth circa 230k. Are EA full of ****e and the prices AE provide are not realisitic and expect buyer to offer way way less.

The bubble may be bursting, but we are still in the middle of it.

Valuations are out of kilter with historical and international norms. They will be until the bubble has completely deflated and possibly undershot on the downside.

Until then, valuations will be high, and anyone buying will be buying in a falling market. Such buyers do exist, so in that sense there is a property market up and running, but the number of transactions is relatively miniscule. In fact, transactions are so low that the staple 3 bed semi no longer appears on the PTSB/ESRI house price index!

A 3 bed semi in Firhouse for 310k will attract some interest right now. After all, you yourself are interested in it. The issue is, are there enough people interested in €300K+ 3 bed semi's in Dublin 24, who also have the means to finance such a purchase, to satisfy the supply that exists? Given the length of time a lot of property in that area has been on the market, you would have to say, probably not.

EAs and sellers are playing a kind of musical chairs game, hoping that the 1 legitimate purchaser who is willing to pay 300K for a house in a market where 10 of them exist in the supply chain will pick the house that they are selling.

If not, then they have to wait a while, knock another 10% off the price, and hope that an other guy who is willing and able to buy at 270K will come looking at their house and buy it.

Eventually the market will reach a point where supply meets demand, transactions go up, and the turnover rate of houses on the market returns to relatively normal levels.

How long will this take? Buggered if I know, but it's looking like it could take a few more years at the rate it's going.

Da GOAT · 13-01-2010 3:48pm

I much appreciate your great responses to my queries, thx a million.

It does make me consider me own situation. Unless I can get a fairly big if not huge chunk off the price of the 310k house for example Im better off not buying now at all. If I could get it for say 230k then im doing well right, it will prob be worth that or close within 2-3 years and I would gain advantage of lower interest rates right now. If not I should stay away for another year renting?

I dunno how simple or slow Im coming off here but I didnt know anything about property a week ago lol.

Offer prices

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