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    • NaughtiusMaximus
    • By NaughtiusMaximus 7th Dec 17, 11:06 AM
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    NaughtiusMaximus
    Offer price tactics
    • #1
    • 7th Dec 17, 11:06 AM
    Offer price tactics 7th Dec 17 at 11:06 AM
    What are people's thoughts on the best tactics when attempting to negotiate a price with a vendor?

    Say for the sake of argument I see a house listed at £200k but the most I am prepared to pay is £190k. Conventional wisdom would be to make an opening offer at a point below 190, maybe between 180 and 185, and negotiate from there. Is there a benefit in instead going straight in with the final offer of 190 and refusing to budge from there, do you think this gives the impression of being a more serious buyer?

    There's probably no right or wrong answer here, I'm just curious as to your opinions. I'm currently leaning towards the latter option but that may be coloured by the fact I dislike haggling any more than I have to.
Page 1
    • aneary
    • By aneary 7th Dec 17, 11:08 AM
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    aneary
    • #2
    • 7th Dec 17, 11:08 AM
    • #2
    • 7th Dec 17, 11:08 AM
    I would go in lower tbh then if the EA asks for Full and final offer you have somewhere to go up to.
    • Surrey_EA
    • By Surrey_EA 7th Dec 17, 11:10 AM
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    Surrey_EA
    • #3
    • 7th Dec 17, 11:10 AM
    • #3
    • 7th Dec 17, 11:10 AM
    In my experience most sellers are conditioned to reject the first offer, so I would suggest the former approach might work best.

    As ever, it depends on the individual vendor, and the particular property in question, as well as what other competition there is.
    • hazyjo
    • By hazyjo 7th Dec 17, 11:17 AM
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    hazyjo
    • #4
    • 7th Dec 17, 11:17 AM
    • #4
    • 7th Dec 17, 11:17 AM
    I'd try a combination of both - go in at £185k (presuming you think it's worth that!) and say you don't think there's much if anything left in the pot. They always try to get more so maybe then jump a couple more grand. Or try £186k to sound a bit less like you're jumping up and offering in £5k increments.


    If it's been on the market at that price for months, I'd go in lower or hold out for a reduction by them if they didn't accept my offer. I'd not leave it on the table or they'd be less inclined to drop the price later on.
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    • ReadingTim
    • By ReadingTim 7th Dec 17, 12:06 PM
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    ReadingTim
    • #5
    • 7th Dec 17, 12:06 PM
    • #5
    • 7th Dec 17, 12:06 PM
    I think most vendors expect a buyer to go through the pretence or charade of haggling, even if it is a largely symbolic - an elegant if meaningless courtship dance if you will.

    Not to do so might mark you out as a little odd - and a single "take it or leave it" ultimatum would probably invite more people to leave it than take it. I think your first approach is therefore more sensible.
    • Mutton Geoff
    • By Mutton Geoff 7th Dec 17, 12:10 PM
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    Mutton Geoff
    • #6
    • 7th Dec 17, 12:10 PM
    • #6
    • 7th Dec 17, 12:10 PM
    Also bear in mind an offer is not just about the price. Along with your offer, let the agent know you've employed a fast legal team (not the cheapest online conveyancers), you will take a view on some issues if they are time hurdles (eg obscure searches), you'll ignore trivia in the survey report, your finances are already in place, you've already sold and are in rented etc.


    If you've yet to arrange finance and your existing property is not sold (if you have one), then you are not in as good a place as someone who is sorted and ready to go.


    When I moved last, I had already sold, was near exchange, didn't want a survey etc and got a substantial discount off the asking price. There was another buyer in at full asking price but their sale had just fallen through so I was able to step in and secure the property at, to me, a very good price.
    Compensations/Refunds from Banks & Institutions - £4,165 | Stooz Profits - £7,636 | Quidco - £4,014

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    • Lokolo
    • By Lokolo 7th Dec 17, 12:48 PM
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    Lokolo
    • #7
    • 7th Dec 17, 12:48 PM
    • #7
    • 7th Dec 17, 12:48 PM
    Just to have another view. When I was looking there were some properties that were extremely popular. At this point there wasn't much point haggling and starting low as there were always going to be others putting in offers.

    For these I always just put in my final and best offer, a couple I lost out on as there were other bids higher, one went to final and best offers which I re-submitted the same offer and also lost out on, and finally I got one.
    • n217970
    • By n217970 7th Dec 17, 12:49 PM
    • 241 Posts
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    n217970
    • #8
    • 7th Dec 17, 12:49 PM
    • #8
    • 7th Dec 17, 12:49 PM
    I've had success with making a nice rounded offer - say 185,000 expecting it to be rejected before going back with a "I've done my sums again and its the very top of my budget" offer of something weird like 188,672 - making it look like I've been checking down the back of the sofa for spare cash.

    Its worked 2 out of the 3 times I have done it, in both cases I would have been prepared to pay 3-5k more. In the case it didn't work I walked away as vendor was unrealistic on price after being on the market 12 months. It was repo'd 6 months later and sold for quite a bit less then I offered and hugely less then the asking price. Mad.
    • NaughtiusMaximus
    • By NaughtiusMaximus 7th Dec 17, 12:53 PM
    • 532 Posts
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    NaughtiusMaximus
    • #9
    • 7th Dec 17, 12:53 PM
    • #9
    • 7th Dec 17, 12:53 PM
    Thanks for the comments and useful advice everyone, interesting to her your views.

    Also bear in mind an offer is not just about the price. Along with your offer, let the agent know you've employed a fast legal team (not the cheapest online conveyancers), you will take a view on some issues if they are time hurdles (eg obscure searches), you'll ignore trivia in the survey report, your finances are already in place, you've already sold and are in rented etc.
    Originally posted by Mutton Geoff
    Oddly enough pretty much all of those apply to us, the sale of our old property has now completed, we have sufficient funds in the bank to allow for a 30-35% deposit, for conveyancing we will use the same solicitors we've used twice before. Good tip about the surveys, we will likely go for a full buildings survey but the aim is to identify major issues, we have no intention of attempting to renegotiate the price based on survey findings which would come under the categories of routine maintenance or 'to be expected for a property of this age'.
    • AdrianC
    • By AdrianC 7th Dec 17, 12:59 PM
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    AdrianC
    There's as many "right ways" as there are vendors.

    TBH, if I was the vendor of a £200k property, and your maximum was £190k, I'd be more inclined to consider it if you came straight in at £190k and said "Look, this is it, take it or leave it". If you say £180k, then go to £190k (especially if you go via £185k), I'd be more inclined to think "They're bluffing and will come nearer".
    • hutman
    • By hutman 7th Dec 17, 1:34 PM
    • 79 Posts
    • 26 Thanks
    hutman
    depends on the demand for the property; it has an inverse relationship with haggling power.

    if the property is starved of viewings and offers, assuming the estate agent is not lying, then i would go 20% below what your max is. another factor to consider is how desperate the seller is; perhaps this is the best scenario for those hoping for some savings.

    the market is somewhat begrudgingly moving towards a more even playing field between seller and buyer. transactions have dramatically reduced and the brexit waiting game has assumed. good news to some extent for our generation rent of first time buyers!
    • Nadeshkarine
    • By Nadeshkarine 7th Dec 17, 1:45 PM
    • 13 Posts
    • 9 Thanks
    Nadeshkarine
    We went for the no nonsense approach and offered our maximum as a take it or leave it offer. The estate agent/seller seemed to want to play the haggling game however, and came back to us 3 times over the course of a week to say it wasn't enough but if we could just offer a little more they might consider it...

    Eventually they did accept it, but I think most sellers /agents seem conditioned to play the game and feel like buyers always hide their actual maximum.

    In the final "round" I had to really stress we weren't playing games and point out we were looking at other places as it we couldn't go any higher.

    I don't understand the psychology of this negotiations, much prefer genuine asking prices and offers - there's enough stress in house buying as it is!
    • Surrey_EA
    • By Surrey_EA 7th Dec 17, 2:27 PM
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    Surrey_EA
    In the final "round" I had to really stress we weren't playing games and point out we were looking at other places as it we couldn't go any higher.

    I don't understand the psychology of this negotiations, much prefer genuine asking prices and offers - there's enough stress in house buying as it is!
    Originally posted by Nadeshkarine
    It's a game when the sellers ask a buyer for an increased offer, but it's not a game when you offer below the asking price? Surely you can't have it both ways?

    If you want to avoid "playing games" just offer the price the property is advertised at! But it seems you went viewing houses listed at a price you were unable to afford, something a seller may consider to be playing a game.

    Nobody is "playing games." It's called negotiating. The price rarely feels enough for the seller, and normally feels too high for the buyer, that's just human nature.
    • Nadeshkarine
    • By Nadeshkarine 7th Dec 17, 2:51 PM
    • 13 Posts
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    Nadeshkarine
    I guess what I meant is that this back and forth is so ingrained that they don't really believe you when you say it's your maximum. They assume that we are hiding an additional offer when we offered a fair and final amount. I felt it was a bit odd to turn it down asking for more, but then be happy to accept it after all. But I guess it's all down to how each side feels.

    In terms of asking vs offer price it depends on the market but we offered in line with selling prices, which is how we determined our affordability. We've been monitoring the asking and selling prices in the area (albeit with the lag) and nothing has gone for asking that we've seen. I think part of this is the market returning to more even levels after a lot of years of above average growth.

    So for the OP my feeling is go for whichever approach you are more comfortable with and based on the local market. If it's still very buoyant and seller driven they may expect more haggling. I do wonder if our sellers would have been happier if we started lower but had negotiated up to the same price. From our side we didn't want to risk missing the house by offering too low and wanted to give as honest an initial offer as possible.
    Last edited by Nadeshkarine; 07-12-2017 at 2:59 PM.
    • Surrey_EA
    • By Surrey_EA 7th Dec 17, 3:12 PM
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    Surrey_EA
    I felt it was a bit odd to turn it down asking for more, but then be happy to accept it after all.
    Originally posted by Nadeshkarine
    Not really that odd. The vendor was obviously hoping for more, and when it became clear you would not increase further, and they received no other offers they made the decision to accept the offer you had earlier made, despite having previously declined that figure.
    • RedfordML
    • By RedfordML 7th Dec 17, 3:32 PM
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    • 379 Thanks
    RedfordML
    Zero benefit of going in at 190k.


    If you offer 183k, it may get accepted, so going in at 190k you could overpay.


    Also if they flatly refuse 190k, you've no scope for movement. They refuse 183k, go 187k, then 190k to show how keen you are.


    good luck.
    • theGrinch
    • By theGrinch 7th Dec 17, 5:19 PM
    • 2,790 Posts
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    theGrinch
    no such thing as a standard case. depends on the positions of buyer, vendor and competitions
    "enough is a feast"...old Buddist proverb
    • Bean1356
    • By Bean1356 7th Dec 17, 9:05 PM
    • 1 Posts
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    Bean1356
    We're trying to decide on just the same situation at the minute. House is listed at £400k. They've already reduced by £10k since first listed. My husband wants to go in at £375k but I've been leaning toward going in with £390k which is the max we're willing to pay. I'm afraid £375k is too cheeky and might upset them but he reminded me that we made a cheeky offer for our current house and ended up getting it for £23k less than the asking price so I think you're always better going in lower... even if it does make me nervous we might miss out!
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