Putting an offer on a House

laser750

Hi,

So my girlfriend and I have taken the plunge and put an offer on a house we really like. And as in so many other cases the agency have come back and stated that a counter offer has been received.

Can we find out if the other offer is genuine? I have heard of many cases where bogus offers have been made to increase the sale price.

If an offer is accepted are we bound to the offer or can we back out with reason?

JimmyMW

laser750 wrote: »

Hi,

So my girlfriend and I have taken the plunge and put an offer on a house we really like. And as in so many other cases the agency have come back and stated that a counter offer has been received.

Can we find out if the other offer is genuine? I have heard of many cases where bogus offers have been made to increase the sale price.

If an offer is accepted are we bound to the offer or can we back out with reason?

You can back out at any stage up to when a contract is signed

Michael D Not Higgins

There's no way to find out how genuine the offer is. The best advice is only offer what you can afford and back out if the bidding goes higher than what you've budgeted for.

SarahMollie

Estate Agents have to record all offers should the process be audited in the future if someone makes a complaint. For that reason, the agents through whom I bought my house asked for any offer by email so they'd have a record.
You can of course pull out at any point before contracts are signed, as can the vendor.

For what its worth, I think these stories of Estate Agents behaving badly are vastly over reported. People love to moan about the buying and selling of houses.

One thing to keep in mind is that an EA makes a % of a sale. So it the house sells for €250k or €255k makes very little difference to their commission. If they were working on a 1% basis, the difference would be €50. Would you risk your job/risk losing a good potential buyer for the possibility of earning an extra €50? They're usually all about getting it sold as quickly as possible and moving on to the next.

Facts are that supply is low and its still a sellers market out there.
Anything decent is going to be viewed by lots of potential buyers so a counter offer is not unusual.
Actually, to not have another bidder involved would be less usual these days.

SarahMollie

Estate Agents have to record all offers should the process be audited in the future if someone makes a complaint. For that reason, the agents through whom I bought my house asked for any offer by email so they'd have a record.
You can of course pull out at any point before contracts are signed, as can the vendor.

For what its worth, I think these stories of Estate Agents behaving badly are vastly over reported. People love to moan about the buying and selling of houses.

One thing to keep in mind is that an EA makes a % of a sale. So it the house sells for €250k or €255k makes very little difference to their commission. If they were working on a 1% basis, the difference would be €50. Would you risk your job/risk losing a good potential buyer for the possibility of earning an extra €50? They're usually all about getting it sold as quickly as possible and moving on to the next.

Facts are that supply is low and its still a sellers market out there.
Anything decent is going to be viewed by lots of potential buyers so a counter offer is not unusual.
Actually, to not have another bidder involved would be less usual these days.

wonka

We recently went through around 3 different attempts to purchase a property, and were outbid on each. Some of these came in as 'last minute' offers so we were understandably skeptical. However, after we pulled out we never got a call back so the offers were obviously genuine.
Only way we eventually got a property was to go in with a bid 10% ABOVE the asking price. Told them it was valid until the end of the week. Voila, they accepted!!!!

wonka

We recently went through around 3 different attempts to purchase a property, and were outbid on each. Some of these came in as 'last minute' offers so we were understandably skeptical. However, after we pulled out we never got a call back so the offers were obviously genuine.
Only way we eventually got a property was to go in with a bid 10% ABOVE the asking price. Told them it was valid until the end of the week. Voila, they accepted!!!!

Michael D Not Higgins

SarahMollie wrote: »

One thing to keep in mind is that an EA makes a % of a sale. So it the house sells for €250k or €255k makes very little difference to their commission. If they were working on a 1% basis, the difference would be €50. Would you risk your job/risk losing a good potential buyer for the possibility of earning an extra €50? They're usually all about getting it sold as quickly as possible and moving on to the next.

The problem is they're under instruction from the sellers who might say they won't settle for less than 255k so the agent is then looking at the difference between no commission and 2,550. This is a more likely scenario where the bidder is nearly at the magic number and the agent invents a situation to inject urgency into their bidding.

There have been bidders here who have said the agent just outright told them the sellers wouldn't settle for less than x thousand and they should up the bid to match that. It's not a leap to think agents would use other strategies to achieve the same end.

SarahMollie

Michael D Not Higgins wrote: »

The problem is they're under instruction from the sellers who might say they won't settle for less than 255k so the agent is then looking at the difference between no commission and 2,550. This is a more likely scenario where the bidder is nearly at the magic number and the agent invents a situation to inject urgency into their bidding.

There have been bidders here who have said the agent just outright told them the sellers wouldn't settle for less than x thousand and they should up the bid to match that. It's not a leap to think agents would use other strategies to achieve the same end.

I had this exact situation, and the agent handled it as described. They wanted €xk, I'd out bid the previous bidder but was still €5k below what they said was the least they'd accept (€10K under advertised asking price). Agent told me they'd just rent the place out again as it had always been a buy to let, rather than sell. Ultimately, we split the difference because I really wanted it, and they got a bit closer to their ideal number.

I'm not saying its beyond the possibility that an EA could misbehave but I don't think its anything as common place as some people like the OP seem to believe. There are bad apples in every profession but the OP hasnt said anything that would lead me to believe that theres anything to see here, other than a house that might actually be nice, in a market with short supply, so more than one party are interested.

Just becasue someone else bid on the same property of them, they're just suddenly suspicious but without any actual grounds or specific shady behavior to base this notion on, other than they've heard on the grapevine that sometimes EAs are not always honest. This is just sterotyping, like saying that accountants are all boring, and politicians are all corrupt.

Michael D Not Higgins

SarahMollie wrote: »

I'm not saying its beyond the possibility that an EA could misbehave but I don't think its anything as common place as some people like the OP seem to believe.

Yeah, which is why the advice I try to give is basically set a budget and don't bid above it. Then it doesn't matter who the bidder is, phantom or not.

Butters1979

I agree. I don’t think this phantom bidding is very common at all, especially during a seller’s market. You don’t need to make up bidder’s when there’s a lot of interest in a property. The whole process of buying a house can be extremely stressful and this can produce a lot of paranoia. If it’s a house you like then it’s very possible it’s also a house someone else likes.

Everyone involved plays their cards very close to their chest in this process which doesn’t help the paranoia. I do wish it could be a bit more open sometimes, it would make things simpler. We were outbid on our first three houses. When we came to the fourth property we were the highest bidder but were still 10K below listed price. Estate agent said he talked to the vendor and they still feel it’s a bit low, but if we meet them half way they’ll take it off the market and go sale agreed. This saved a lot of waiting around and stress which was really good.

Sometimes vendors holding out for that extra few thousand really slows all this down. If someone is close just tell the EA that if the bidder goes to X we’ll take it off the market.

Butters1979

Edit: double post again, fix your website

SarahMollie

Michael D Not Higgins wrote: »

Yeah, which is why the advice I try to give is basically set a budget and don't bid above it. Then it doesn't matter who the bidder is, phantom or not.

This doesn't necessarily help the OP though. Their max might be €xk above their first offer, but they're stressing that the first counter offer isnt real. They might still have plenty of room to move their bid upwards, but logically want to pay as little as possible.

I understand this, but I think they could risk losing out on a property because they're paranoid that there is a phantom lurking rather than just being happy to pay what they think the house is worth and not a cent more.

Michael D Not Higgins

SarahMollie wrote: »

This doesn't necessarily help the OP though. Their max might be €xk above their first offer, but they're stressing that the first counter offer isnt real. They might still have plenty of room to move their bid upwards, but logically want to pay as little as possible.

I understand this, but I think they could risk losing out on a property because they're paranoid that there is a phantom lurking rather than just being happy to pay what they think the house is worth and not a cent more.

There's no advice for the OP here, what's your point? Are you saying they should or shouldn't bid?

draiochtanois

This post has been deleted.

SarahMollie

Michael D Not Higgins wrote: »

There's no advice for the OP here, what's your point? Are you saying they should or shouldn't bid?

My advice, as clearly stated above is not to be paranoid without having any basis other than general nonsense talk about Estate Agents, and if they like the house, pay what they think its worth.

SarahMollie

draiochtanois wrote: »

This post has been deleted.

Its normal enough for people to hold back even if they're interested.
I've done it before myself. I didn't want to show my hand too early, but once I saw what was going on, I made my best and final offer. Went sale agreed shortly after.

Subsequently went tits up as my solicitor found an issue with their title, but this is neither here nor there.

If you'd been watching this from the outside you would think I was a phantom, as the house reappeared on all the usual sites, albeit with a different EA.

The issue was a meter wide strip of land across the front of the driveway which the developer didn't have absolute title for and my solicitor unearthed evidence that someone had already tried to challenge his right to build the houses in the first place.

The EA I dealt with on this was actually disgusted with the vendor as he'd been kept in the dark, and felt like with the title issues as they were, the house was almost unsalable so he'd wasted his time as well as mine. (I was even more disgusted as I'd also wasted money on solicitors and other professional fees).

The process is not very transparent, but Land Law in Ireland moves at a glacial pace so I don't think anything is going to change in time for our OP to buy his house.

Michael D Not Higgins

SarahMollie wrote: »

My advice, as clearly stated above is not to be paranoid without having any basis other than general nonsense talk about Estate Agents, and if they like the house, pay what they think its worth.

Which is nigh on identical to my advice, there's no reason to be argumentative with me on your own point.