What to offer?

Wig

A house I have been interested in,

The previous occupier tried to sell it beggining around April 08, he must have bought a new build home and sold it in part exchange to the house building company - I won't name them but I am now certain this is what happened.

Advertised price in May 08 was 110K, Sold June for 106K
06 2008........£106,000
07 2004........£106,000
10 2002........£56,000

Although the house was sold in June 08, no sold sign went up and the house continued to be for sale @ 110K - I was confused around Sep 08 why houseprices.co.uk were showing that it sold in June for 106K - weird.- was thinking all sorts of reasons, death estate, or repossession.

Although we wanted to view it we never got round to it, because the price was too high and it did not tick all the boxes. Then late October 08 the house was reduced to 80K from 110K, a much better price. And also appeared on EA2's website. Because we felt EA1 was a smaller operation than EA2 we decided to give our business to EA1

[rant] (you can skip this bit)
We arranged a viewing with EA,1 who on the day of viewing did not phone us but we phoned them to confirm the viewing, for them to say "Glad you rang because we can't find the keys" - said they would continue to look for them, we heard nothing further, so phoned them again 30 mins before appointment, "no still don't have the keys, have to reschedule" so we delayed until the following Saturday (7 days).

Following Sat, again no call from them, so we phoned them, "We don't have you in the book"
us "Well we should be because last time you lost the keys and it was re sheduled to today"
Them"I don't know who you spoke to, let me see, oh, the house is sold now anyway"
us"Whether or not it is sold we should still be in the book"
them"Well I can only apologise for that."
This was really annoying because we could have arranged to view other houses on this Saturday, had EA1 done us the courtesy of phoning us to let us know the house was sold and the appt cancelled.

We'd had a viewing before (different house) with this EA and they didn't show up, so we had learned to always phone them before going.
[/rant]

The house, although removed from EA1's website still remained with EA1's board outside. And remained on EA2 website for a further 2 weeks, and I did not phone EA2 until a couple of days ago, to enquire why it was not listed as sold. They said the sale had got chain problems, and the seller has decided to keep the house on the market. So I've arranged a viewing.

I'm a cash buyer, so I am in a very good bargaining position. But even at 80K I am actually not happy with the price. I constantly watch the auctions and notice properties are selling for 2002 prices sometimes 2001 prices. The only problem for us is that the "right property" is yet to appear at auction. I have worked out that 80K represents a 2003 Q2 price. The house was renovated after the 56K price so that's not an accurate price to work from.

2003 Q1 price would be £72500
2002 Q4 price £72000
2002 Q3 £66000
2002 Q2 £62500
2002 Q1 £58000

I was thinking, if we don't really like it but "it will do" because we do need a house, of offering 50K and increasing from there in 5K chunks, but maybe if we actually like it we should start @ 60K and increase in 2K chunks, to a maximum of 70K.

I feel sure they will definately accept 70K, and I wouldn't be happy paying more than that.

What do you think?
Where would you start and increase by mow much?
Should I ask them what their bottom price is -after my first offer is refused? It would save a lot of hassle if they told the truth.

Thanks

poppysarah

Gawd it sounds like one of our local EA.

Try 70k and say thats it.

Doozergirl

I'd do what you're suggesting, it sounds fair.

If it is a part-ex, they will play hard with you but you have cash and they have probably had it up to the hind teeth with the house.

Yes, after your first offer, ask what they would accept if it is refused. But still keep offering lower and never up your offer in the same conversation as when a previous offer is being rejected - I can read people that do that like a book

Incisor

Have clearly in mind your limit and always offer less initially, simply because your first offer will most probably be rejected as a matter of course - and if you start off with the top offer, you have no margin. When they say no, you are probably best to indicate where you top offer lies such that seller suggests something near.

Doozergirl

Incisor wrote: »

When they say no, you are probably best to indicate where you top offer lies such that seller suggests something near.

I don't get that.

Presumably you're saying to bluff telling them what your top offer is rather than actually telling them what your top offer is?

ad9898_3

Start at 60k and goto 70, the last 7 years have been pure bubble, taking into account the undershoot 70k would be my limit.

flissh

Wait a minute, you don't really like it, but it'll 'do', because you need a house!! Okay, it might not cost all that much compared to some houses, but 70k is a lot of money to spend on something you don't really like. Especially as you probably won't be able to sell this for a good long while.
Why not wait until you find something that you do like, just in case you have to keep it for a good few years.

besonders1

I agree with flissh. If you are going to buy a house, buy only when the market settles and there is evidence that the house prices are increasing again. Offer the going rate for the year 2002 and walk away if they refuse, I can't see there being much competition to be gazumped, even if you do that says nothing! If I was selling a house I would not take any offers seriously unless they were either cash offers or they had an approved mortgage offer. No one knows what the "new" prices will be but at the moment house prices are going only one way and thats down. There is plenty of house I would like to buy but all the best ones in nice area are overpriced so i am still renting,

Incisor

Doozergirl wrote: »

I don't get that.

Presumably you're saying to bluff telling them what your top offer is rather than actually telling them what your top offer is?

More or less. It all depends what the 2nd offer comes out like. Suppose it ia advertised at 100, seller has 80 as top offer. So

Seller: 100
Buyer: 75
Seller: 90 and not a penny less
Buyer: I am prepared to offer a little more, but i can't/won't go as far as splitting the difference
Seller: 82.5 [splits difference]
Buyer: 80

The idea is to help the Seller to avoid tying himself up with statements such as '90 and not a penny less' and avoid both parties adopting inflexible positions simultaneously.

Wig

Didn't like the houise, not for 80K anyway, It was so small and grade II listed.

I value it at no more than 50K, over the last 10 years the EA always priced this row of houses higher than other houses in the area, I can't understand why, and I don't understand why people paid the prices. But my suspicions have been confirmed that even after knocking 30K off the price this property is still 30K overpriced, compared to what you can get nearby for 80 - 90K

I don't think I will be making any offer it's not big enough for us. @ 40K I would be tempted.

I wonder what some fool will be prepared to pay for it.

besonders1

Wig wrote: »

I wonder what some fool will be prepared to pay for it.

Well let them have it and they'll find out when they are stuck with a house they can't sell later on. They'll be plenty of other houses turning up in the new year.