How much to discount an offer

brightonmatt

Right,

Been looking at houses for a while, seen the asking prices frop around £10K - £15K.

What sort of %'age below should i offer.

I know it's easy to suggest as low as possible, but realistically, if it were you, how low would you go.

Say house up for £200K a few months ago, now on at £188K - What would you offer?!

All subjective i know, but nice to know what others think

Cheers

hethmar

Would depend on how much I really wanted it matt. I guess a cheeky £140k to start?

Incisor

brightonmatt wrote: »

Right,

Been looking at houses for a while, seen the asking prices frop around £10K - £15K.

What sort of %'age below should i offer.

Right. Wrong question. Some houses are ridiculously priced and have been kept at that price for months, in which case you either trim back on their asking price very heavily, to the extent that they probably wouldn't accept even a generous offer in the present market, or leave them because you judge it will be a waste of time until you see them drop the asking price. Some houses are more reasonably priced but are not that attractive, so you trim quite heavily and expect that you might get some negotiation going. Some houses are priced a bit high, but are attractive and if you really want them you trim back a bit and expect to raise your offer a bit to make a deal. And other houses are reasonably priced and you still trim back a bit, but if they are genuinely reasonably priced, you might expect to pay nearly the asking price.

There is no magic formula linking asking price and the minimum price which will secure a deal.

Conrad

matt I'd say buyers ought to be looking to pay 25% less than peak 2007 prices. It can be done

hethmar

Conrad, I pmd you, hope you dont mind.

Love_bargains_2

An old boss of mine told me about a time when he was buying a flat in London in the 80's. He put forward a very low offer which the seller refused. THEN he got about half a dozen mates to go see the same flat over the next few days and put forward even lower offers than his. This really spooked the seller and when my boss called back with a slightly higher offer he accepted it!

monkeymaster

brightonmatt wrote: »

Right,

Been looking at houses for a while, seen the asking prices frop around £10K - £15K.

What sort of %'age below should i offer.

I know it's easy to suggest as low as possible, but realistically, if it were you, how low would you go.

Say house up for £200K a few months ago, now on at £188K - What would you offer?!

All subjective i know, but nice to know what others think

Cheers

Have a look on www.ourproperty.co.uk and find out what this property or similar ones were selling at in 2003 - that would be a good start I'd suggest. You have to be careful with asking prices, for example near me one has come on the market today for 145k when the highest price achieved for a like-for-like property on the same road was 129k at the peak of the market so in this case even at 20% off it would still be over-priced.

Davesnave

Love_bargains wrote: »

An old boss of mine told me about a time when he was buying a flat in London in the 80's. He put forward a very low offer which the seller refused. THEN he got about half a dozen mates to go see the same flat over the next few days and put forward even lower offers than his. This really spooked the seller and when my boss called back with a slightly higher offer he accepted it!

These aren't the '80s and most people are wise to that one, having heard it many times. Anyone who got half a dozen viewers in quick succession nowadays would be 'spooked' anyway, regardless of what followed!

Sam_BMN

Offer as much as you think it's worth less a 'credit crunch discount' just for good measure. Hopefully, you will have seen enough other properties to get a good idea of that the one you like is worth. Remember, if the seller accepts your first offer then walk away - you've offered too much! You can always come back and say that, afterall, the bank will only lend £X so you've got to reduce you offer to £Y.

Don't rely too much on the asking price - this is usually set by estate agents, and it's usually the ones that quote the highest price that get the job. I had this problem a few years ago - I was selling my flat and we went with the estate agent who gave the highest estimate. The flat didn't shift for 6 months - not even an offer! So I sacked the estate agent and ended up giving it to one who quoted a lower price (about 10% less), and I started getting offers the same week, agreed a sale 10 days later.

I saw the property crash coming a mile off and moved back in with my parents after selling my flat in 2007, so now I'm a first time buyer again with a nice big deposit, although I won't be buying for a while (not before June '09). So, I've been tracking the prices of flats in London that I've had my eye on since the sale. There's a particular property in Bayswater that has been on the market since February 2007 (repeat: February 2007!!) at £300k. I can see from the photos that there's no furniture in there so there's no one living in the property, so the seller is probably loosing money every day. Yet, to date, the flat is STILL for sale, and the price is STILL £300k even after everything that has happened in the economy over the last 12 months.

Moral of the story: don't rely too much on where the asking price is set. If I were interested in buying the flat I mentioned I would start with an offer around £220k, and see what the reaction is.

Also, once you've put an offer in to show your interest, even if it's rejected you might be able to get a bit of guidance from the estate agent about what the seller would be prepared to accept.

abaxas

140-150k? including credit crunch 'discount

sympatex

I've been looking with my gf for over a year, we still get knocked back at 10% under asking, getting fed up but we're sticking to our guns as we feel we're being generous given the current sentiment.
DYOR, everywhere all over the country is different infact in london most noticeably even street by street can vary massively.

I have use property bee, houseprices.co.uk and nethouseprices.com, if we see a house we like, do the research previous sold price if avail, previous of houses in road, previosu of houses in area of same build type & council tax band and then personalise the offer to the hosue you're buying.

I'm finding our offers are coming in at 2004 prices for our area. (HPI has varied widely over the whole of the uk, eg; in the soth east where i live house:earnings haven't risen as much as say areas in the north east, proven by the fool.co.uk recently).

Good luck, do what you're happiest with as it's you that will be living there.