best and final offers - tactical tips please???

happinessfactory · 4 October 2007 at 7:25PM

Hello,

You may have read my earlier thread bemoaning the state of the West London zone 2 housing market.

Anyway, earlier this week we bid on a house that is currently in very poor condition but on a very desirable road. It is currently divided up into two flats and needs an enormous amount of work, but because of its location has attracted HUGE interest.

We supposedly had a sealed bids situation on Monday but it later transpired the vendor had no intention of making his mind up until tomorrow. The house is being sold following a court order, and tomorrow is apparently the meeting with his co-owner's solicitor.

The house is being marketed through four agencies so over the last few days we've tried to get the agent through whom we viewed on side, in the hope he would find out how much it would take to close the deal down; but either the vendor is a complete shark or the agent a total muppet because we are no closer to striking a deal.

Tomorrow 9am is a 'best and final bids' situation. We really want and need this house but can't afford to overpay on it because of the enormous amount of work it needs to be habitable. (We'd also be paying rent to live elsewhere whilst the building work is being carried out).

What should we do? We sold our flat back in April so are chain-free cash buyers, and we're prepared to make a strong offer, but I'm rapidly learning this means nothing in the West London market...asking price plus, or nothing.

Help, please. Before I go mad...

Thank you!

dolce_vita · 4 October 2007 at 7:30PM

Whatever you do, don't get into a bidding war. Decide what you are prepared to pay and offer no more.

best wishes.

Romani_Ite_Domum · 4 October 2007 at 8:38PM

One thing that came up on this board a few months back is that "sealed bid deadlines" and "best and final offers" don't always mean a thing and offers can still come in after the deadline.

Don't overstretch yourself, but make a good offer. Good luck.

cheekeemonkey · 4 October 2007 at 9:12PM

We had a similar situation a while back.

We spoke to the vendor and his EA to try and do a "hearts and minds" on the house owner!

It transpired that they were looking for a strong offer but also someone who could move quickly.

So try and find out a bit more if possible.

PS - we didn't get the house -sold to a bl*&$y developer!

budget_counsellor_shaz · 4 October 2007 at 9:46PM

I've been there too. The best advice I can give you is do not spend more than you can afford (or more than what the property is actually worth). There are plenty more fish I mean houses out there. Don't let your heart rule your head:rolleyes:

If you have cash why not go to an auction there are a couple coming up?

Anyway whatever you decide all the best

Shaz

happinessfactory · 4 October 2007 at 10:41PM

Thanks for the replies all.

I had a thought - could we go in with a real pie-in-the-sky offer in the hope of getting the house without further ado, and then ask our surveyor to deliberately undervalue the property? When I say 'undervalue' I mean its sensible price: what the house *should* cost based on the Land Registry numbers, the wider postcode's overall annual % increase and the cost of works.

Because we have very low LTV we could make up the shortfall in the valuation out of capital if it meant paying less overall? Although of course the buyer could turn round and tell us to sod off........

Romani_Ite_Domum · 5 October 2007 at 10:26AM

You might be getting a little carried away with this idea.

If you are willing to risk the valuation/survey fee and more time of uncertainty then it may be worth it for you.

I am not sure you can ask the valuer to undervalue the property though.

Perhaps you could get a valuation and full survey for a high LTV on an offset mortgage? That way the lender will be more inclined to get true valuation in the current economic climate. If that was to come in at your unaffordable offer or close you would have to walk away. Of couse, even if the valuation was less than your offer, it dosn't mean the vendor will accept a revised offer either.

Richard_Webster · 5 October 2007 at 11:58AM

Decide what you want to offer and add a figure like £102 to it!

The theory is that someone else might have offered the round figure amount you thought of so you want to beat them! Taking the process further they might have though of adding £100 so you want to beat that!

Problem here is where you stop second guessing other's bids.

nobblyned · 5 October 2007 at 3:35PM

I bid over asking price in a "best and final" arrangement in SW London about 2 years back. I bid around 1% above asking and as Richard suggests above went to a non-round number just above this to outfox the other bidders!

We got the place, but I've no idea what the other bid was, so I may have just cost myself a few k. Still, we are very happy there. The market was as busy in SW London as it is now, and 1% above sealed the deal for us. I would certainly play on your ability to move quickly without needing a mortgage though, perhaps advising in your letter that your offer is subject to them exchanging within 6 or 8 weeks, would show that you are completely confidant in your ability to move quickly and are in fact questioning theirs.

happinessfactory · 7 October 2007 at 8:04PM

Thanks for the tips everyone.

We didn't get the house - we were 'second favourites' supposedly, but were outbid by a property developer offering a whopping £20k more. We've been told 1 in 3 sales falls through so let's wait and see what happens. We couldn't afford it at that price though, so we don't feel so bad. It's not like we were outbid by a mere tenner:eek:

I'm so bored of looking for houses now.

Nenen · 7 October 2007 at 8:12PM

so sorry you didn't get the house... but as you said, you never know! Good luck.

PLEASE READ BEFORE POSTING

best and final offers - tactical tips please???

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free