Smartest way to win a bid on a house

davo10

M.Cribben wrote: »

368k is only 2% over asking price (360k). Not that unusual for desirable properties in good areas. A house near me in West Dublin (typical 4-bed semi-d) recently sold for 15% above asking.

It's unusual that a house would be taken off the market the same day it was put on, just for 2% above asking, strange indeed.

Bob24

davo10 wrote: »

Taken off the market the day it went on, for €8k above asking? Wow, just wow. I bet the buyer can't believe his/her luck.

Or the asking price was more of an aspirational one and fairly optimistic compared to market value, and the the seller is still wondering how someone paid even more (unless they don't care about money or have no clue about the market, the only reason for accepting would have been if they though they were getting a great deal).

Graham

Bob24 wrote: »

the only reason for accepting would have been if they though they were getting a great deal

or they were looking for a quick sale

Bob24

Graham wrote: »

or they were looking for a quick sale

True, but in that case the main driver for accepting would probably have been the cash offer combined to an acceptable figure.

Andrew Beef

Say the asking price is €600k.

I would bid €550k, assuming that the asking price is reasonable.

Bob24

Andrew Beef wrote: »

Say the asking price is €600k.

I would bid €550k, assuming that the asking price is reasonable.

That was my way of doing it at the beginning of my property search to get the ball rolling. But then I realised that assuming you know the market value is 600k+, most of the time it it pointless to start well below that figure as anyway 600k will be reached. So in most cases what it's doing is just making the bidding process longer and potentially attracting more competition from people who wouldn't have shown interest otherwise but are lured into bidding due to that lower starting point; and might end-up increasing their budget and becoming competitors as the bids progress and they get more excited about the property (which IMO is why EAs still entertain some bids which are bellow the minimum value the seller is ready to accept: it gathers interest and can trigger a bidding war).

But again, there isn't really one smart way to do it and that one could work in some circumpstances.

Andrew Beef

It’s one of those things where you only know the right approach after the fact. A friend of mine is about to close at around 8% below asking, albeit at a higher price level (circa €850k). It depends on the price level too; there is clearly more liquidity at lower levels. For example, at €450k asking I think I’d pitch up at €430k.

Brian?

Andrew Beef wrote: »

It’s one of those things where you only know the right approach after the fact. A friend of mine is about to close at around 8% below asking, albeit at a higher price level (circa €850k). It depends on the price level too; there is clearly more liquidity at lower levels. For example, at €450k asking I think I’d pitch up at €430k.

My experience this year is that everything is going for 15-17% over asking. So just big asking and bidding up in 10k bids got my bidding done and I was able to move on in my life.

It’s not a buyers market under 400k. A huge mistake to assume it is.

Andrew Beef

Brian? wrote: »

Andrew Beef wrote: »

It’s one of those things where you only know the right approach after the fact. A friend of mine is about to close at around 8% below asking, albeit at a higher price level (circa €850k). It depends on the price level too; there is clearly more liquidity at lower levels. For example, at €450k asking I think I’d pitch up at €430k.

My experience this year is that everything is going for 15-17% over asking. So just big asking and bidding up in 10k bids got my bidding done and I was able to move on in my life. It’s not a buyers market under 400k. A huge mistake to assume it is.

That’s too much of a generalisation. The probability of getting a property at less than its asking price is not zero; there is no harm whatsoever in opening the bidding at 95% of asking.

Cocobeans101

Brian? wrote: »

My experience this year is that everything is going for 15-17% over asking. So just big asking and bidding up in 10k bids got my bidding done and I was able to move on in my life.

It’s not a buyers market under 400k. A huge mistake to assume it is.

For the last two years, I've been recording sale prices and what they sold for in my area(Dublin Suburb). Once you go over 750K, they pretty much go for asking. Of course there's been a few anomalies but often they are just short of asking.

Cocobeans101

M.Cribben wrote: »

368k is only 2% over asking price (360k). Not that unusual for desirable properties in good areas. A house near me in West Dublin (typical 4-bed semi-d) recently sold for 15% above asking.

It can work if people have a bid on another house. They need to sell to buy. My friend accepted asking after one viewing. She needed the deposit for the house she was buying.


Whereas, the house I'm bidding on, the owner has died and they're 6 children waiting for their inheritance.

blue note

People on this thread seem to be assuming that the asking prices are reasonable. I've viewed around 50 places at this stage in my search and some of them I've thought were really interesting at the asking price. But when you ask what they're going for their invariably way above the asking price. Then there are others which are way overvalued. The very first place we saw was listed for 650, the second place we saw for 395. If you asked me what I felt they were each worth I'd have said there's around 50k of a difference between them. I was also told that the place for €650k had an offer in of the asking price, but they were still doing open viewings and when leaving were suggesting that we come back, with our friends or family for opinions, or an engineer, and that they could basically show it anytime. 4 months later it's still there. Hmmmm, I wonder about that offer......

Anyway, I know it's virtually impossible, but I'd try to disregard asking prices as much as possible. Decide how much it's worth to you first and try to start 5-10% down from there. If the asking price happens to be lower than this obviously start a little below it! If it's drastically different you might want to consider that there's no point in putting in a bid for 75% of the value.

The final thing I'll say is as a tactic, adding 1k to the previous bid seems to be highly effective. I've had a few friends tell me that they got frustrated by others using this tactic and dropped out of bidding processes. I experienced it on the first place I saw and it was incredibly frustrating. In the end we joined in to let them get frustrated too, but we stuck to our guns and just went to probably a few thousand more than we felt it was worth and dropped out then. Those other bidders though started 15k under asking. Someone else went up 5k, they increased by 1. We came in at the asking, they increased by 1. We tried increasing by 5, 3, 4. Every time they went up by 1. From their first bid to the one accepted they only ever went in increments of 1, only ever bidded once a day and went up 58k. The bidding process went on for over a month and I the end was going up about 8k per week. This is a frustratingly effective tactic!

bacon?

It's a sellers market right now especially for first time buyer homes, <400k.

I don't think there's any real tactic, certainly not putting an ultimatum on a seller to accept an offer, back in 2009 etc, sure, now, not likely, there's too much demand, plus rents are mental now.

I tried to buy in 2003, when there was a bit of a frenzy, kept being out bid by "investors" sure, who knows if these are real, there really should be more transparency.

I stuck to my budget and had to give up in the end. Came back 2 years later and finally bought, at a lot more than 2003 price. Of course everything went to $hit 2 years later, but that's the property market.

Good luck.

whatever76

Brian? wrote: »

My experience this year is that everything is going for 15-17% over asking. So just big asking and bidding up in 10k bids got my bidding done and I was able to move on in my life.

It’s not a buyers market under 400k. A huge mistake to assume it is.

Could not agree more - in Cork City its under 300k !

whatever76

whatever76 wrote: »

Could not agree more - in Cork City its under 300k !

Definitely a buyer's marker in Cork on anything over 400k that requires work.

Loads of properties like this all over the likes of Bishopstown that are going up on Daft at ridiculous prices and then being dropped after a few weeks of no action. I saw one just today that has been reduced by 50k.

I follow the selling prices on the register and the vast majority are not even making revised asking prices.

I bought a similar property for well below asking recently and my bidding was reflective of this.

draiochtanois

This post has been deleted.

uck51js9zml2yt

A friend offered asking on a house recently and then the sellers got greedy and told the EA they wanted 20k more than asking.
When he went back to my friend with the rejection he said not to bother offering any more. The house wasn't worth what they think they can now get.

davo10

Lorenzo Sparse Peppermint wrote: »

A friend offered asking on a house recently and then the sellers got greedy and told the EA they wanted 20k more than asking.
When he went back to my friend with the rejection he said not to bother offering any more. The house wasn't worth what they think they can now get.

Considering that houses generally sell for above asking, I don't see why this would be considered greedy, also as your friends bid wasn't accepted, this situation is no different than any other bidding process, the sellers don't have to accept the asking price. If it sells for asking, the EA was right, if it doesn't then the EA was wrong, time will tell. The EA doesn't decide the price, the sellers and the market do.

Bob24

IMO it is silly for a seller to set an asking price they are not willing to accept. What’s the point in setting a price at all then?

(As per whether the house sell for above, below, or at asking ... it simply depends on where the bar was set with asking compared to the market value)

davo10

Bob24 wrote: »

IMO it is silly for a seller to set an asking price they are not willing to accept. What’s the point in setting a price at all then?

(As per whether the house sell for above, below, or at asking ... it simply depends on where the bar was set with asking compared to the market value)

How can you know in advance what the highest price is that someone is willing to pay for a property? Asking prices are nothing more than guides, the market then sets the actual price. Why would a seller accept X when a bidder is willing to pay X + 15%? it wouldn't make sense

Bob24

davo10 wrote: »

How can you know in advance what the highest price is that someone is willing to pay for a property? Why would a seller accept X when a bidder is willing to pay X + 15%? it wouldn't make sense

You can know in advance the lowest price you are willing to accept. That is all you need to set a realistic asking price.

davo10 wrote: »

Why would a seller accept X when a bidder is willing to pay X + 15%? it wouldn't make sense

Obviously, but how does this relate to my post? All I’m saying is that a seller should set an asking price they are willing to accept if there is no other offer, of course if there are higher offers they will go with those.

handlemaster

Andrew Beef wrote: »

Say the asking price is €600k.

I would bid €550k, assuming that the asking price is reasonable.

So that would mean your offer would be unreasonable

davo10

Bob24 wrote: »

You can know in advance the lowest price you are willing to accept. That is all you need to set a realistic asking price.



Obviously, but how does this relate to my post? All I’m saying is that a seller should set an asking price they are willing to accept if there is no other offer, of course if there are higher offers they will go with those.

But property sellers always set out to get the highest price achievable unless they need to sell urgently, advertised price may be the minimum a seller will accept in advance of the property going on the market, but the market sets its value and that then influences what will be acceptable to the seller.

uck51js9zml2yt

My friend is considering his options
. If the seller comes back to him in a few weeks it's a new bid with the origina having been refused.
He's considering 10k less than asking to see where it goes.
EA seems to think they won't get the new price and said wait it out for a few weeks. It's a country location

Obviously he's looking elsewhere

Captain Flaps

When we viewed the house we just bought, we left our details with the agent and waited for them to call us. She did, asked were we interested, told us the current bid. I said leave it with me and called back with a bid 2 days later of that bid plus 5k. Pretty much played it like that the whole way through the process, my highest bid was an increase of 5k, lowest was 1k. Towards the end the other bidder went with the 'throw everything we have at it' tactic and raised by 10k, I waited 48 hours and went up another 2k, our offer was accepted and we moved in last week.

There's no hard and fast rule but in my experience the best advice I got was never bid more than once in 24-48 hours, and never place a large (5k or more) bid unless you're reaching the top of your limit, otherwise you're just encouraging everyone to start chucking money around in the heat of the moment.

davo10

Lorenzo Sparse Peppermint wrote: »

My friend is considering his options
. If the seller comes back to him in a few weeks it's a new bid with the origina having been refused.
He's considering 10k less than asking to see where it goes.
EA seems to think they won't get the new price and said wait it out for a few weeks. It's a country location

Obviously he's looking elsewhere

I think the EA is being extremely unprofessional and certainly should be sanctioned if the seller finds out about what he said. The EA is paid by the seller to achieve the best price.

Time will tell if your friend's strategy works, some posters might suspect the EA may be clearing the way for another bidder to get the property by advising your friend not to bid.

MrFinance

Cocobeans101 wrote: »

I need somewhere to live!

Two birds, one stone?

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uck51js9zml2yt

davo10 wrote: »

I think the EA is being extremely unprofessional and certainly should be sanctioned if the seller finds out about what he said. The EA is paid by the seller to achieve the best price.

Time will tell if your friend's strategy works, some posters might suspect the EA may be clearing the way for another bidder to get the property by advising your friend not to bid.

He's actually away in holidays for a few weeks which is easily verifiable

davo10

Lorenzo Sparse Peppermint wrote: »

He's actually away in holidays for a few weeks which is easily verifiable

In a digital age, this means zero.

MattressRick

Pintman Paddy Losty wrote: »

A lot of the people posting here have no idea how to think outside the box when it comes to bidding. You need to really get inside the minds of the seller and any other bidders. It's as much a psychological battle as it is a business transaction. You need to get an edge on people. You could pay the neighbour a few hundred euro to park a caravan in his driveway and give the appearance he's a traveller on viewing days. That will make others less interested in bidding.

Stop day dreaming.