FTB how much should we offer

fuzzybear_4

We've viewed a few houses and found two that we really like in the same street. One is priced at 109995 and is terraced with a garden only accessible from the house, while the other one is 114995 and more cottage like, a semi and access to the garden from a front gate.

We have a mortgage in principle, deposit ready and can move in asap.

How much would you think to be sensible offers on these two properties?

rchddap1

What do you think its worth? And remember you can always raise your offer...bit harder to decrease it.

Bermuda_John

80% of asking price then go to 85% the 87.5% then 88.75% then 90% final offer.

Bermuda_John

80% of asking price then go to 85% the 87.5% then 88.75% then 90% final offer.

109,995

1st offer: 87,995
2nd offer: 93,495
3rd offer: 96,245
4th offer: 97,500
final offer: 98,995

the amounts increase less on each offer giving the impression that you are reaching your maximum bid.

Dont go 85, 90, 95, 100 as they can see the pattern.

Or you could use very specific figures which gives the impression you have a set limit/budget

Phill_1981

Is an 80% offer not taking the !!!!!! a bit? I am also thinking of making an offer on a new build one bedroom flat priced at £165k, based on this you think I should offer £132k?

AndrewSmith

Hi,

You are in the fortunate position of being what every estate agent is looking for, that is a proceedable first time buyer. You are very valuable to any property chain as you are able to complete the lower end of the chain and get it moving.

In my experience with estate agents (8 years) you should not only focus on the amount you are offering, but should also emphasise the excellent position you are in.

1) Mortgage arranged
2) Deposit ready
3) Solicitor standing by (if you haven't got one GET ONE)
4) No Chain below you
5) Keen to move

The offer itself is entirely down to you, however the current vendor will need to acheive a certain level of offer to make their purchase happen. Try not to expect to get a huge amount off a property worth £109,995, then anything you do get off will be a bonus.

Before you make your offer you need to know some key points:

1) Onward Chain, how big, how stable
2) Position of the Vendor (have they applied for their ongoing mortgage or indeed have they yet found a property)
3) Other interest in the property (Despite what you may be told the EA should not lie about this as everything has to be documented these days and he can get into serious trouble if he does).
4) Other offers
5) How long has the property been on the market (if it's new to the market you are unlikely to get much off the asking price at all)

In my experience a sensible opening offer on a property of £109,995 would be around £99,950. The conditions of your offer are that:

1) You have exclusivity :ie the property comes off the market and all future viewings are cancelled.
2) Your offer is subject to satisfactory survey.
3) Carpets and curtains are included.
4) You will instruct your solicitor immediately, and expect the same from the vendor.

There is no exact science however when in an enviroment like today's where property prices have not increased by any dramatic amounts, most sellers will need fairly close to the asking price to be able to afford the move at all.

Hope this helps

Andy

zag2me

Phill_1981 wrote:

Is an 80% offer not taking the !!!!!! a bit? I am also thinking of making an offer on a new build one bedroom flat priced at £165k, based on this you think I should offer £132k?

Absolutley not, most sellers value their houses far higher than they are actually worth, and it also depends on their situation. If they are desperate to move or if the house has been on the market for some time. No-one accepts the first offer anyway so you might as well make it a low one, then increase as much as you want.

I think the average selling price is 93% of asking price.

New builds are a bit different but there are big discounts to be had if the developers are desperate to sell. Personally if its a flat I wouldnt touch a new build with a barge pole, vast oversupply in most areas of them now.

Bermuda_John

80% is fine as a starting point, you can only go up after your first offer.

Go on https://www.houseprices.co.uk and type in the postcode to see what the houses in the street actually SOLD for not what they wanted.

IMHO if your not embarrassed by your offer then it isnt low enough, the EA has a duty to pass this onto the vendor so iuf they say it is too low to submit then remind them of their duty.

No doubt 80% would get rejected in 99% of cases but you might just get lucky.

As AndrewSmith said you are in a very strong position so would NEVER pay 100% unless you really really really wanted the house.

Originally Posted by Phill_1981
Is an 80% offer not taking the !!!!!! a bit? I am also thinking of making an offer on a new build one bedroom flat priced at £165k, based on this you think I should offer £132k?

And yes i would offer 132,000 on a 1 bed new build and go up in the stages i mentioned before, these will be the first houses to go down in value and are more than likely over valued at the moment.

Check the website to see how much they sold for.

Bermuda_John

Zag2me you beat me too it!

fuzzybear_4

I've been on houseprices.co.uk and the surrounding houses have gone from 111000 to 119000. We put an itial offer in of 111000, expecting it to be rejected. We're thinking of putting in a next offer of 112250 and then if we really have to go up to 113000. This would be the complete max we could pay as there's no more money left!

The house has only just come on the market and has several viewers this week (of so the EA says). Do you think our plans sensible? Also, when the EA calls back to say no ( as I'm sure he will) do I put in a nother offer immediately or wait? If so how long should I wait?

AndrewSmith

Before you commit another offer I would ask for an urgernt second viewing as you are really interested but just want to be sure before you increase your offer.

Make the appointment for around 7.00-7.30 ish (tell the agent you cant get their sooner). This will ensure that it is the vendor who shows you round (especially as you have seen it before). You then have the vendor to yourself and can ask fairly non pressure questions such as "how much interest has their been?" and "have you had any other serious proceedable offers yet?".

You can also ask the current vendor about their own position and whether accepting an offer from you would complete the chain. No good offering high if they have not found a house yet.

Find out as much as you can without actually asking the direct "what will you accept" question.

Puts you in a better position when going back with another offer.

Andy