Any point in lowballing offers?

Antilles

Hi,

We've just been approved a mortgage in principle from our bank and are about to start looking at houses in Dublin.

All our friends bought years ago, and their advice is uniformly that we should offer about 20% lower than the asking price as our "initial offer" when we find somewhere we want. One even said that if the current owner isn't insulted by the first bid, then we've bid too high. The idea is that the current owner will make a counter-offer that's lower than the asking price and we can save a bit of money but still get the house. We're not trying to rip anyone off, just get a fair price.

I've been watching the news and it all seems to be about Dublin property prices increasing as there is a lack of houses in the city. So, is there any point in offering significantly lower than the asking price these days, even as an opening bid, if there's a glut and it's likely someone else will come up and beat our offer straight away?

Thanks!

ezra_pound

Antilles wrote: »

Hi,

We've just been approved a mortgage in principle from our bank and are about to start looking at houses in Dublin.

All our friends bought years ago, and their advice is uniformly that we should offer about 20% lower than the asking price as our "initial offer" when we find somewhere we want. One even said that if the current owner isn't insulted by the first bid, then we've bid too high. The idea is that the current owner will make a counter-offer that's lower than the asking price and we can save a bit of money but still get the house. We're not trying to rip anyone off, just get a fair price.

I've been watching the news and it all seems to be about Dublin property prices increasing as there is a lack of houses in the city. So, is there any point in offering significantly lower than the asking price these days, even as an opening bid, if there's a glut and it's likely someone else will come up and beat our offer straight away?

Thanks!

In current dub market I'd be very surprised if this advice is of any use whatsoever. Sure give it a go but it will probably be waste of phone call tbh.

caew

It depends what area of Dublin you are buying in. Not all areas are on the rise.

I would do some research. Look at selling prices on property price register, look at what the original asking price was (all price histories can be found on line). You will then get an idea of how much more or less the houses are going for compared to asking price.

On daft now they show how much the price of the house has changed beside the selling price

The area of Dublin I am looking houses are selling for 13%-17% less than asking price and all the price changes have been down the way, not up the way.

Curran

To give you an idea; Im in the process of selling a 2 bed house in Swords.
First offer was 13k below the asking price and 3 weeks later, after interest from 4 or 5 parties, the final price was was 12k over the asking. Though we took a slightly lower offer, as person is a first time buyer and the highest bidder was a link in a longer chain...auctioneer adviced to go with a purchaser who is least likely to let you down.

Then, on the other hand, the house we're purchasing, we got it for below the asking, as we were the only serious interested party. So we were very fortunate. We offered below, got turned down, left it a while and then asked what the seller would take and we agreed on that, because we were avoiding delaying the process, which could potenitally allow another person to become interested and then its a bidding war.

It all depends on the interest on the house you hope to buy. No harm in putting in a well below the asking price offer; if there is no interst you might be lucky! If there's interest, Id say it will quickly move up to close to the asking price.

Best of luck with the hunt!

pawrick

Not dublin but all the houses I had looked at over the summer went for between 10% to 15% less than asking since. Low ball with the expectation to haggle and the risk of losing out if there is good demand in the area.
There will always be wiggle room on the asking price no matter where the place is located so definitely check the sites mentioned already to get a true idea of what to pay and take your time before making a decision.

pawrick

Not dublin but all the houses I had looked at over the summer went for between 10% to 15% less than asking since. Low ball with the expectation to haggle and the risk of losing out if there is good demand in the area.
There will always be wiggle room on the asking price no matter where the place is located so definitely check the sites mentioned already to get a true idea of what to pay and take your time before making a decision.

strandroad

Depends on the area. We just went sale agreed using this approach. South Dublin, not a terribly sought after area, but the seller priced it high and took well below the asking price. Still more than other houses in the vicinity sold for, though.

miezekatze

I also think it depends on how much demand there is for this particular house in the area, and on how realistic the asking price is in the first place. I bought in South Dublin and paid a bit more than 10% below asking price, but the asking price was set too high in the first place. Other houses I viewed went for over asking price. I think it's pointless making unrealistically low offers. I'd offer the lower end of what I consider to be realistic and see where things go.