Advice on making an offer very soon!!

Meredith

My partner and I have been looking to buy a house for over a year now. We have seen lots of houses in this time and last weekend saw a house that we really like and it ticks all the right boxes for us. The house only went up on the website last week. We went back to see it today and the estate agent said an offer (first offer) had been made since Saturday. Of course we are fully aware that this might not be true but this house will sell quickly anyway as it is ready to move into, is in great condition and needs no work done whatsoever (this is a big plus for us).

We have approval for about €10k more than the asking price and we have the deposit. We are also ready to move at short notice. Most estate agents have asked us if we have loan approval but this one hasn't and we haven't told her that we have it either.

The (alleged :D) offer made is €20k less than the asking price (if an offer hadn't already been made, we would have gone in a lot lower than that to start with but obviously we can't do that now) and the estate agent said that the seller is looking for a figure closer to the asking price....well, what else would they want?! We are fully aware that we are at the mercy of the estate agent :mad: but we really want this house and we can go to the maximum asking price if needs be but obviously we want to keep it under that if at all possible.

We haven't told the estate agent yet that we want to put in an offer but we intend on doing so this week. I would be grateful if anyone has any advice about how much we should offer...go in around €5k more than the other offer or just be bold about it and go higher (around €8k-10k more) and show we are really serious about this house? We also hope that given we have approval for more than the asking price and are ready to move quickly might work in our favour.

All suggestions/feedback etc is welcome thanks!

:)

Slydice

First thing is: You sound waaaay too excited. You need to chill.

Cool down and get a clear head. You're making what a lot of people consider a big decision.

Now, the best piece of advice is not to get hooked on the property. It's not a hot guy or girl. It's just property. Yes, we've all lived in houses and we know how much we want to own one of our own. Still though, try your best not to get hooked. Be prepared to walk. Decide a line you won't cross. Otherwise you're leaving yourself vulnerable to a really good salesman (the estate agent in this case).

Moving fast won't be in your favour. It'll show your hand to the agent. The property market doesn't move fast and estate agents know that. Houses with high prices are staying on the market for ages. Well priced houses are staying on it for at least 3 months.

Remember, the agent might not actually have an offer.

Keep looking at the market but do your homework on the house. You can show interest but do it by viewing the place a few times. Make sure there isn't stuff you've overlooked. Be sure to let the agent know you are looking at other places. He might even give you advice about your property search.

Ask the agent about the other offer. Does he think it'll go though, does he think it's a fair offer, does he not think the place should go a bit cheaper, why are the others offering so much. He may bend his story (i.e. the people who offered don't have mortgage approval yet) and that may indicate he doesn't actually have an offer.

If, after a while, he doesn't change his story, then proceed cautiously in bidding higher as you can get screwed in a bidding war. Remember to have the line you won't cross and be prepared to walk. Even after you walk, the agent may crack and reveal that there may not have been an offer (i.e. the other peoples offer or "sale agreed" may have fallen through)

Idbatterim

you could match the offer and say you are ready to move immediately... maybe say you are also very interested in another property! ofcourse the EA could be telling the truth. But if not, bull**** can go both ways...

P. Breathnach

Have a think about the asking price: is it realistic, or is it, as with the majority of properties on the market, on the optimistic side?

If it is true that somebody has already offered €20k less than the asking price, you should consider walking away. Chances are that the other party has some more bidding capacity, and you could find yourself in a bidding war. You don't need that: there is more than one perfect house for you.

I'd be inclined to suspect that it isn't true. In your position, I'd tell the EA that I could be interested, but not at the price level that seems to be operative. Then hold your nerve, and wait to see if the EA gets back to you.

Keep on looking at properties.

TwoShedsJackson

Meredith wrote: »

go in around €5k more than the other offer or just be bold about it and go higher (around €8k-10k more) and show we are really serious about this house?

Don't do this. Look on it as a business transaction, which is what it is. Offer 2k more and see what happens.

If the agent comes back saying 'oh the other bidder has offered another 5k', tell them your previous offer stands for a week, if you don't hear from them before then look for somewhere else.

It's a buyers market, there is no reason to be going in 8 or 10k over the supposed other offer to 'show we are really serious about this house'.

Joe10000

If it was me I would do my research to establish the current market value of the house and then offer 10 to 15% less, even if your offer is lower.

The market is flooded so do not let the EA suck you in.

mercenary2

ea do bullshi.e most of the time i was looking at a site of 1.6 acre before christmas and ea told me there was a offer on it already and told me how much so i left it till after x mas hols to go back and make a offer of exactly what he told me had been offered if you seen his face the excitment of getting a offer for it ,although offer was refused at only 5 k below asking ,good luck to the seller you wont be getting my money greedy basta..
im in no hurry so if its there at the end of the year i will go back with a offer about 5 k less than what i already did..:)

Mr. Loverman

Meredith wrote: »

go in around €5k more than the other offer

TwoShedsJackson wrote: »

Offer 2k more

Why offer 2k or 5k more? Offer 1 euro more. You'll save yourself a lot of money.

If the house is reasonably priced (and by that I mean it is absolutely nowhere near the prices people paid 2 or 3 years ago) then you could go for it. But really be sure you aren't setting yourself up for horrible negative equity as you never know what the future will hold... especially if your partner isn't a marriage partner.

Diddler1977

I wouldn't start bidding with anything more then what you were originally bidding.

Tell the EA that the bid that is currently in is more then were willing to spend.

Don't allow yourself be manipulated by the EA or other parties.

You do not need to be in a bidding war in this market.

Go view more properties and wait for the call from in the EA in a week or two when the current offer has "fallen through".

pawnacide

Hi

I've noticed that when it comes to house buying those who reply are extremely cautious. Just as when selling a house you should always set a limit that you are content with. This should not be a notional value picked out of the air but should be based on current market values. Without knowing the house I can't advise on that but if you want to pm me I will.

Unlike many I'm going to assume there is an offer on the table as the agent is not aware you're a serious buyer or intend making an offer.

When you've decided on your limit you need to ensure the bidding is structured in such a way that you are the one to offer your max price, otherwise the other bidder might get it for your price. To start with offer 1000 more than current offer.

If, btw, you go up in 1 euro increments, as someone suggested you'll just annoy the owner and he/she is under no obligation to sell to highest bidder.

If it continues to go up in 1000's that's fine, might take a while but eventually you'll get to your max or within 1000 of it.

If the other bidder jumps by more than 1000 at any point you'll know he's pretty serious as normally the first bid increase sets the amount for the bid increases. Also if he increases by more than 1k it's at this point you really need to be careful to ensure you're the one who gets to offer your max.

Also be aware that the agent is now trying to close the deal with the other buyer and probably by now has a new bottom line from the seller. Ask him what it is and/or what the sellers reaction was to the original offer other than ' he wants closer to the asking' . You might, just might get a pleasant surprise.

Best of luck.

zac8

I don't think you'll do this but I think you should post a link. Then you can get some real feedback rather than wild guess work. Maybe even get some feedback on the agent involved and how they operate.

Since almost every property on the market is on daft, anybody actively looking in this area will already know about this property. There is not a queue of people here waiting to pounce on this property if you reveal it.

solovely

The exact same thing happened to me when buying my house. "Another bidder" had an offer in for €20k below the asking price, and like you I had approval for €10k above the asking price. I'm still not sure if there ever was another bidder, and often regret not holding out and offering less.

I told them I had full loan approval, and could prove it to them immediately, the others didn't. I offered to match the "other bidder"'s offer, and was ready for a quick sale (so was the vendor). Withing 24 hours they went sale agreed.

That was over two and a half years ago, and judging by other houses in the area and asking prices, I'm in very little negative equity, so I don't regret it, and I do love my house. But I do wonder about that "other bidder" and what would have happened had I held my nerve. Still, no other house in the area has come up for sale that I would consider as nice or as good a bargain as mine, so I'm glad I did what I did!

Loan approval is worth more than any higher bids at this stage though, so my advice would be to play that card as much as you can!

zac8

I just phoned an agent there about a house and they told me there was an offer on it about 7% below asking. The location on daft was wrong. After I found out from the agent the exact location I said it wasn't the area I'm interested in anyway. They still wanted my phone number and tried to arrange a viewing.

A high percentage of these situations are clearly phantom bidders. That's the first time in over a year that I've enquired about a property and back then every one that I looked at had an offer on it. Pathetic.

kennyb3

How much is the asking and what's the general area its based in?

amber2

You could get your solicitor who will be dealing with the sale and mortgage drawdown to put in an offer for you on an in trust basis and he will act on your instructions and get the best deal for you.

P. Breathnach

amber2 wrote: »

You could get your solicitor who will be dealing with the sale and mortgage drawdown to put in an offer for you on an in trust basis and he will act on your instructions and get the best deal for you.

In what way is that better than dealing with things yourself? Most buyers can look after their own interests at the negotiating stage, particularly if they seek and consider advice from others as part of their decision-making process - which is what OP seems to be doing here.

pawnacide

amber2 wrote: »

You could get your solicitor who will be dealing with the sale and mortgage drawdown to put in an offer for you on an in trust basis and he will act on your instructions and get the best deal for you.

Why? solicitors have no special expertise in house price negations. If he wants to get paid he'll just offer the max you're willing to pay.

monkeybutter

There is nothing wrong with putting in a bid for a few grand more, you aren't committing to buying it. Put yourself in play.

We have no idea of the house in quesion, if the asking price is reasonable etc, how desperate they are to move, the seller still has power in this game, although it's a buyers market, if they don't want to sell at a price, most still wont budge too far.

Put in the bid, see if they jump for the bait, then play the waiting game, dilly dally, then drop the bid, the ball will now be in your court. If they have another buyer and you aren't prepared to outbid them, then you won't get the house. Simple as that.

If they don't have a bidder and you wait them out, theres at least a chance they'll except a bid lower than the asking price (the asking price has essentially been set as -20,000 by the agent), but only time will tell. And you have time on your side as prices are still falling and this could put pressure on the seller.

On top of that the agent wants a sale, the more work they have to put in for the sale the worse for them, but make them work for it, play them out this takes time. While it's true that the agent is being paid to lie for the client, he/she is really only interested in the cut they get, so they can and do push the seller as well as the buyer. A couple of hundred in the commision needs to balanced out against the time required to make it.

Lastly, I'd deffo wait for the house sale index thats promised, apart from people figuring out how to lie to the revenue and cheat the system, this will give you a more accurate picture of prices.

jackal

I think there are a lot less phantom bidders out there than people seem to think. EA's really don't stand to gain much by scaring bidders off, so the likelihood is that a) the seller won't entertain offers under a certain amount or b) there actually is another bidder. In the case of a) I think its a good tactic, as a lot of buyers will just get snotty at that and start giving out to the EA does the seller not realise its a recession, blah blah blah. Saying there is another bid takes the heat out of it.

You will never know if its true, you can only guess. If you suspect its a phantom bid AND are prepared to lose the house, then it can be worth letting the EA stew on it and just saying "ok well we are not getting into a bidding war", or "that was what I was going to offer" and just ask them to get back to you if the other offer falls through.

The best strategy is to simply decide what you are willing to pay, decide if that is good value, put a max which you will not breach (not an arbitrary one, but one that you have a logical reason for) and bid. The days of topping bids automatically by 5k or 10k are long gone. 1k is plenty.

monkeybutter

Do you really think the agent is going to go to admit there are no bids on a place, no interest? They would be showing an extremely weak hand by admitting this.

If the house is up ages or if the house is just fresh, there is always interest in the house, even if there isn't.

So they make up a bid, which is lower than the asking price to see if they get a bite, especially if you seem keen and admit to liking the place etc etc, which you should never do. Make up a bid and it puts doubt in the minds of buyer, someone else is interested, what should I do? I could lose the house of my dreams, you've already imagined the next 20 years there, kids, dogs etc etc.

The agent is a shark, you the house buyer are a sheep. They do it for a living. They made a killing off driving the property market up, they have been able to convince people to buy into a massively falling market in 2008, 2009 and 2010, I mean fair play to them for pulling this off, but we need to learn a lesson from all this.

Sales people are paid liars. Estate agents, Mortage brokers or anyone who is paid on commission. Do not trust them. Even when you think they are working for you (the seller), they aren't.

If you question the liar aspect, just read the descriptions that accompany house advertisment on daft, myhome etc. Cozy = small, quaint = run down, close to amenities = 5 miles from the nearest shop, up and coming area = rats nest.

zac8

monkeybutter wrote: »

Do you really think the agent is going to go to admit there are no bids on a place, no interest?

No, but making up bids that are close to the asking in order to set a floor has been self defeating for most agents and the unfortunate vendors they represent.

Snakeblood

zac8 wrote: »

No, but making up bids that are close to the asking in order to set a floor has been self defeating for most agents and the unfortunate vendors they represent.

They're representing the vendors, the vendors set the price with the estate agent that they will accept. Making up bids that are close to the asking is part of the estate agent lying to sell the house, establishing the floor beyond which their client has told them they don't want to sell. It may well be self defeating, but it's the vendor defeating themselves, the estate agents are using a grubby bag of tricks to help them.

monkeybutter

zac8 wrote: »

No, but making up bids that are close to the asking in order to set a floor has been self defeating for most agents and the unfortunate vendors they represent.

How oh how do you know this exactly? have you been trying to sell a house and the estate agent tried this and it backfired? How did you find out they tried this?

zac8

Snakeblood wrote: »

zac8 wrote: »

No, but making up bids that are close to the asking in order to set a floor has been self defeating for most agents and the unfortunate vendors they represent.

They're representing the vendors, the vendors set the price with the estate agent that they will accept. Making up bids that are close to the asking is part of the estate agent lying to sell the house, establishing the floor beyond which their client has told them they don't want to sell. It may well be self defeating, but it's the vendor defeating themselves, the estate agents are using a grubby bag of tricks to help them.

I know this. So do most other buyers. Yet agents keep trying the same old tired tricks. They are clueless. Then we see a professional outfit from the uk come in and shake it up. The response from gombeen Irish agents? They say it's a disgrace that commissions are leaving the country. Bunch of wasters.

pawnacide

zac8 wrote: »

I know this. So do most other buyers. Yet agents keep trying the same old tired tricks. They are clueless. Then we see a professional outfit from the uk come in and shake it up. The response from gombeen Irish agents? They say it's a disgrace that commissions are leaving the country. Bunch of wasters.

They're simply UK vendors selling for UK banks, and if by shaking it up you mean selling repossessed properties at ridiculously low prices to a bunch of cash rich carpet baggers .. then yes I guess they are.

zac8

monkeybutter wrote: »

zac8 wrote: »

No, but making up bids that are close to the asking in order to set a floor has been self defeating for most agents and the unfortunate vendors they represent.

How oh how do you know this exactly? have you been trying to sell a house and the estate agent tried this and it backfired? How did you find out they tried this?

Because more often than not the made up bids are so close to the asking that only an idiot would reject it. Yet most of the properties I viewed over a year ago that had an offer still languish on the market.

zac8

pawnacide wrote: »

zac8 wrote: »

I know this. So do most other buyers. Yet agents keep trying the same old tired tricks. They are clueless. Then we see a professional outfit from the uk come in and shake it up. The response from gombeen Irish agents? They say it's a disgrace that commissions are leaving the country. Bunch of wasters.

They're simply UK vendors selling for UK banks

Wrong. Many are private Irish vendors.

pawnacide wrote: »

if by shaking it up you mean selling repossessed properties at ridiculously low prices to a bunch of cash rich carpet baggers .. then yes I guess they are.

if you think the current prices being achieved by Allsops are ridiculously low then you're in for some shock.

pawnacide

zac8 wrote: »

if you think the current prices being achieved by Allsops are ridiculously low then you're in for some shock.

I've said it before I'll say it again .. There will be a two tier market , in fact there is already just nobody is talking about it, second hand repossessed properties will and can be bought from receivers and at auction by cash buyers and those in the know. For those requiring a mortgage it's a different story.

It happened in england at the end of the 80's and the two tier market was being used by both individuals and commercial entities in the UK to lower their rates.
Basically the Revenue valuations office had their ratable values and comparables and the private entities had others which varied greatly. The courts mostly go with the revenue valuations as they recognized that cash buyers did not represent the true market.

I'm not agreeing that this was correct or right I'm just mentioning it happened as a real world example of a post crash two tier property market.

Meredith

Hi everyone,

Wow many thanks for all the replies, feedback, opinions etc it's all very much appreciated.

I can't reply to everyone but to Slydice I totally agree with you, I came across very over eager etc...despite what you might think I really am not!
You are right though that we shouldn't jump too fast however we have seen SO many houses over the last year that we've lost count and this is only the second house we've considered making an offer on. It's easily the best house we've seen. A lot the of houses we saw that were up for a cheaper asking price, although some not much cheaper, would have needed a fair amount of work done which we really wanted to avoid. We always expected that the house we do buy would need work of some sort but this particular one needs no work at all.

We know full well that this house may not be the one. We are going back to see it this week again and we will question the EA about the other offer. We have decided on what our max will be and we won't exceed it no matter what.

Thanks again for all the input, it's most welcome

Damie

If you have the nerve, then the best option is to return an offer less than original, with an expire date. Emphasize that you are mortgage approved and will be buying a house soon, whether its this one, is up to the EA and owners. Act like it doesn't bother you whether you get this house or not...

Meredith

Slydice wrote: »

First thing is: You sound waaaay too excited. You need to chill.

Cool down and get a clear head. You're making what a lot of people consider a big decision.

Now, the best piece of advice is not to get hooked on the property. It's not a hot guy or girl. It's just property. Yes, we've all lived in houses and we know how much we want to own one of our own. Still though, try your best not to get hooked. Be prepared to walk. Decide a line you won't cross. Otherwise you're leaving yourself vulnerable to a really good salesman (the estate agent in this case).

Moving fast won't be in your favour. It'll show your hand to the agent. The property market doesn't move fast and estate agents know that. Houses with high prices are staying on the market for ages. Well priced houses are staying on it for at least 3 months.

Remember, the agent might not actually have an offer.

Keep looking at the market but do your homework on the house. You can show interest but do it by viewing the place a few times. Make sure there isn't stuff you've overlooked. Be sure to let the agent know you are looking at other places. He might even give you advice about your property search.

Ask the agent about the other offer. Does he think it'll go though, does he think it's a fair offer, does he not think the place should go a bit cheaper, why are the others offering so much. He may bend his story (i.e. the people who offered don't have mortgage approval yet) and that may indicate he doesn't actually have an offer.

If, after a while, he doesn't change his story, then proceed cautiously in bidding higher as you can get screwed in a bidding war. Remember to have the line you won't cross and be prepared to walk. Even after you walk, the agent may crack and reveal that there may not have been an offer (i.e. the other peoples offer or "sale agreed" may have fallen through)

P. Breathnach wrote: »

Have a think about the asking price: is it realistic, or is it, as with the majority of properties on the market, on the optimistic side?

If it is true that somebody has already offered €20k less than the asking price, you should consider walking away. Chances are that the other party has some more bidding capacity, and you could find yourself in a bidding war. You don't need that: there is more than one perfect house for you.

I'd be inclined to suspect that it isn't true. In your position, I'd tell the EA that I could be interested, but not at the price level that seems to be operative. Then hold your nerve, and wait to see if the EA gets back to you.

Keep on looking at properties.

Diddler1977 wrote: »

I wouldn't start bidding with anything more then what you were originally bidding.

Tell the EA that the bid that is currently in is more then were willing to spend.

Don't allow yourself be manipulated by the EA or other parties.

You do not need to be in a bidding war in this market.

Go view more properties and wait for the call from in the EA in a week or two when the current offer has "fallen through".

solovely wrote: »

The exact same thing happened to me when buying my house. "Another bidder" had an offer in for €20k below the asking price, and like you I had approval for €10k above the asking price. I'm still not sure if there ever was another bidder, and often regret not holding out and offering less.

I told them I had full loan approval, and could prove it to them immediately, the others didn't. I offered to match the "other bidder"'s offer, and was ready for a quick sale (so was the vendor). Withing 24 hours they went sale agreed.

That was over two and a half years ago, and judging by other houses in the area and asking prices, I'm in very little negative equity, so I don't regret it, and I do love my house. But I do wonder about that "other bidder" and what would have happened had I held my nerve. Still, no other house in the area has come up for sale that I would consider as nice or as good a bargain as mine, so I'm glad I did what I did!

Loan approval is worth more than any higher bids at this stage though, so my advice would be to play that card as much as you can!

Hi Solovely, thanks yes like you I'm ready for a quick sale, can move at short notice etc, been looking for so long now we know what we want and this meets all of our needs. Have only considered putting an offer in on one other property after looking for more than a year now. We will be cautious but definitely want to go for it. Thanks again