Making an offer when buying a house

Mick990

Hey Everybody,

I am sorry if this has already been covered but i could not find it anywhere.

I am currently in the process of buying my first house and I am wondering when making an offer should I offer really low and leave room for negotiation or should i offer closer to the property price i.e. 10%-15% less to try and get the sale closed quickly??

ANy help here is greatly appreciated and once again i am sorry if this has already been covered

Idbatterim

i think it depends on whether the the property is priced competitively or still a joke (in which case I wouldnt bother bidding anyway)! If its competitively priced maybe offer 15% off...

Retail Hell

get the best deal you can, its a buyers market now but be careful, stamp duty may have dropped but that is paving the way for a new property tax in the future. Also make sure you stress test your mortgage,can you still pay it with a 2% rise in the interest rate?

Good Luck

Lantus

It's a buyers market so be as aggressive and pushy as you feel you can be (in a polite way!) when making an offer.

After a viewing take a good look at the property and make any notes or comments on things that could reduce it's value to refer to later. (for yourself) Check out the rest of the area, some streets can be a lot more in an area or estate than others.

While I wouldn't offer a definitive % anything from 5 to 30% could be viable and beyond. The worst that can happen is that you get refused and have to up it a few quid. The days of people queing for houses has long gone. Chances are it's been on the market for ages and the owners are desperate to sell. If your a first time buyer and have no chain your worth your weight in gold. This is a selling point, flaunt it and use it. Never panic, always stay calm and if you have to up your offer very slightly. Emphasise your benefits and be prepared to walk away. There is always a better deal out there.

There is a saying in NE england, 'shy bearns get nought.' (you dont ask, you dont get.)

matsy1

It can be difficult if the price is already quite good, like if its been reduced recently. I went to view a run down house last week, went home and thought about it and called the auctioneer to make an offer 10% lower, he got back to me the next day and said an offer of the full price had been accepted just now! I was gutted. Such a bargain, sure there will be more.

Mick990

Hey thanks peeps for all the advice . I think i got a great deal on my house after some negotiation but thanks again

JoeyJJ

Thats good, Can you give us a hint on the percentage, if you feel happy to say if not no worries. Would be intereste to see some differences between asking and selling.

Mick990

Hey Joey it was a 4 bedroom semi that we looked at . It does need a fair bit of work but they were looking for 210,000 . I originally offered 180,000 but we settled on 190,000. I have a couple of really good friends who are builders who reckon we will easily get the work done for 20,000 (mates rates)

I spoke to an engineer as well and people from the area who told me the general price for houses in the are 230,000-240,000

zulfikarMD

Hi Mick990, would you mind giving the location as well? Thank you.

Treehouse72

Mick990 wrote: »

Hey Everybody,

I am sorry if this has already been covered but i could not find it anywhere.

I am currently in the process of buying my first house and I am wondering when making an offer should I offer really low and leave room for negotiation or should i offer closer to the property price i.e. 10%-15% less to try and get the sale closed quickly??

ANy help here is greatly appreciated and once again i am sorry if this has already been covered

So, the amount you are willing and able to pay is a function of the seller's self-assessed valuation of their own home?

Why not work out what you can comfortably afford to borrow/pay and also assess the value of the house using other metrics independent of the asking price. Those calculations might tell you it is 30% too expensive, not 10%-15%. Wouldn't that be a better way of doing it?


Ed: What I mean to say is this.

Suppose we could objectively tell that a property was worth €200,000. Not really possible to do that, but let's say. That would mean your plan would be to offer c.€180,000, or 10% off.

But suppose the seller has this €200,000 valued property on sale for €300,000. You'd then be offering €270,000 for no reason other than you are knocking a set amount - 10% - off the asking price.

I say this is an insane way to look at things.

Theboinkmaster

Treehouse72 wrote: »

So, the amount you are willing and able to pay is a function of the seller's self-assessed valuation of their own home?

Why not work out what you can comfortably afford to borrow/pay and also assess the value of the house using other metrics independent of the asking price. Those calculations might tell you it is 30% too expensive, not 10%-15%. Wouldn't that be a better way of doing it?


Ed: What I mean to say is this.

Suppose we could objectively tell that a property was worth €200,000. Not really possible to do that, but let's say. That would mean your plan would be to offer c.€180,000, or 10% off.

But suppose the seller has this €200,000 valued property on sale for €300,000. You'd then be offering €270,000 for no reason other than you are knocking a set amount - 10% - off the asking price.

I say this is an insane way to look at things.

+ 1 good advice

Ortiz

Treehouse72 wrote: »

So, the amount you are willing and able to pay is a function of the seller's self-assessed valuation of their own home?

Why not work out what you can comfortably afford to borrow/pay and also assess the value of the house using other metrics independent of the asking price. Those calculations might tell you it is 30% too expensive, not 10%-15%. Wouldn't that be a better way of doing it?


Ed: What I mean to say is this.

Suppose we could objectively tell that a property was worth €200,000. Not really possible to do that, but let's say. That would mean your plan would be to offer c.€180,000, or 10% off.

But suppose the seller has this €200,000 valued property on sale for €300,000. You'd then be offering €270,000 for no reason other than you are knocking a set amount - 10% - off the asking price.

I say this is an insane way to look at things.

The definition of what something is worth is what someone is willing to pay for it so whatever the maximum is that someone will pay for the property in the open market is what it is worth.

Therefore if the OP was to offer €270,000 for the property if it was valued on sale at €300,000 this is in and around what it is worth

Treehouse72

Ortiz wrote: »

The definition of what something is worth is what someone is willing to pay for it so whatever the maximum is that someone will pay for the property in the open market is what it is worth.

Therefore if the OP was to offer €270,000 for the property if it was valued on sale at €300,000 this is in and around what it is worth

If someone pays €270,000 but would have had a bid accepted at €200,000, is the property "worth" €270,000 or €200,000? I would say the latter and the extra €70,000 is nothing more than a measure of the bidder's cluelessness.

The cliché that a property is only worth what someone will pay for it assumes that the offer is at a neutral level and all other things being equal - it is not a phrase designed to describe out-lying or eccentric bids that would not be matched if a similar property came up for sale the next day.

the_syco

matsy1 wrote: »

called the auctioneer to make an offer 10% lower, he got back to me the next day and said an offer of the full price had been accepted just now! I was gutted. Such a bargain, sure there will be more.

Keep an eye out for the house: it may come back on if the other buyer can't get the mortgage.

liger

the_syco wrote: »

Keep an eye out for the house: it may come back on if the other buyer can't get the mortgage.

Or if the other buyer suddenly disappears.


If the EA rings you back and says the other buyer pulled out i would drop my offer lower your 10% beolw asking.

Mick990

Treehouse72 wrote: »

So, the amount you are willing and able to pay is a function of the seller's self-assessed valuation of their own home?

Why not work out what you can comfortably afford to borrow/pay and also assess the value of the house using other metrics independent of the asking price. Those calculations might tell you it is 30% too expensive, not 10%-15%. Wouldn't that be a better way of doing it?


Ed: What I mean to say is this.

Suppose we could objectively tell that a property was worth €200,000. Not really possible to do that, but let's say. That would mean your plan would be to offer c.€180,000, or 10% off.

But suppose the seller has this €200,000 valued property on sale for €300,000. You'd then be offering €270,000 for no reason other than you are knocking a set amount - 10% - off the asking price.

I say this is an insane way to look at things.

Well I'm not totally sure what you mean here bro but we decided what we could afford to borrow when we went in to get our mortgage originally . What I was asking in my original post was how did people come to the conclusion of there offer on a property did they just take a set % off or like you said did you take in all the variables and try formulate an offer??

When we went to view the property we put the offer in on we went the second way we tried to factor in all the variables then we took another 15k off just for devilment . This wasn't a bad idea though because we still got the house at 5k less then what we felt it was worth .

Since then we have had the engineer in and he also agrees that we got a great deal so to be honest I am happy out and more importantly the war office is happy so we are living in peaceful times

BettyBoo2011

Hi folks,

I'm also looking for advice on similar.

We are currently looking at a 285k site. Price was recently dropped from 350k and size of site increased. It has been on the market for 8 months at least, possibly a lot longer. We have been able to suss out the owners situation through contacts and they want to sell as they are looking to build a bigger house on other land they own and sell their existing house so want to sell this other site to raise some cash but they are already very wealthy people and are in no rush to do this, nor are they desperate to sell.

When I rang the estate agent, the price had just dropped and he said there was already an offer in of just under 250k and that the owners would not consider anything under 260k. I have my doubts on that offer info as it was literally a few hours after the price was dropped, but who knows. He said there were about 4 interested parties currently and the above offer on the table from one of them.

We spoke to the architect about the site and plans. He told us he has another couple booked in to come and discuss similar during the week. So there is definately at least one other interested party who are interested enough to go to that effort also. However he said they are looking to reduce down the size of the plans quite a bit so money is prob an issue. So whether they would be going anywhere near asking price if they did go to offer is a question.

What is the best way to approach this and go in with an offer etc? Ideally we would have been lowballing in around 200/220 to start as at the end of the day its still a heck of a lot of money for a piece of land before you ever start a build (site is just under half acre). However with estate agent saying there is already an offer in shy of 250k this is not an option.

We would prob be willing to pay up to a max of 260k for it but would find this very tight so preference is to play this the optimum way if there is a chance to get it for less.

What do you folks think? anyone who has advice or experience in similar situation would be much appreciated.

Thank you!

Treehouse72

Betty, that sounds like a very specific situation and I think it's very hard to give advice on it from the outside without knowing the precise circumstances.

zacchaeus

liger wrote: »

Or if the other buyer suddenly disappears.


If the EA rings you back and says the other buyer pulled out i would drop my offer lower your 10% beolw asking.

This a ply I think some of the EA are using to still justify high market values. Ineviatbale I think that other phantom buyer might disappear and EA will call back asking is your original offer still on the table.. remember mortgage approval values are dropping by the month and banks cant get the money.
Someone who got 350k 4 years ago couldn't get 200k today and thats with no change in personnal circumstances (in recssionary proof job if i can say)

magneticimpulse

From following daft.ie since March 2008, on a particular housing estate in a resonable location in Dublin, ive seen asking prices drop 46% and some houses in said housing estate have been on the market for 2 years, despite the drop in 46% in the asking price...

In theory this means a house which was 350,000 in March 2008, is now advertised for 160,000 on daft and still on the market.

more and more detached 4 bedroom houses on daft.ie advertised at 50,000 euro. the prices are going in the right direction for buyers and that is still down down down.