Sealed Bids???

greg457

My partner and I are thinking of buying a house and the ea said it would be through sealed bids. The sale ends next Friday and have been told that there are 3 other bidders. Does it matter when we put in our bid and should we put in the maximum we can afford straight away or not?
The house is well below the market value but needs alot of modernising.We are first time buyers and could move in very quickly which I would think might be to our advantage and have mentioned this to the ea.

Doozergirl

Sealed bids does mean putting in your best price. You can make your bid when you like but if someone does open it, they are in the position to manipulate other bidders so I leave it to the day and then confirm that they've received it before closing time.

In a sealed bid situation I put it in letter form (a lot of people might just put a number in an envelope) pushing my plus points (yours will be that you are FTB buyer, mortgage agreement in hand and solicitor ready for a swift exchange of contracts!) . I would also state that I was aware of particular issues with the property as it shows that I understand exactly what's wrong with it and therefore won't be renegotiating based on surprises that come up in survey.

When you put your figure down, go just above and make it an odd number so perhaps if I valued a property at 90k I might bid 90,666 so that my offer would be highest if other people though it was worth the same.

We've been in the situation where we've been outbid by someone offering '1 pound more than the other bidder' which is deplorable in my view and I truly believe that what goes around comes around because the person that bought it was an EA, they used it as their shop - the enterprise failed, it's been on the market for what must be two years and they can't sell the building for what they paid for it now.

MissMotivation

Spot on advice there by Doozergirl, as usual :T

One thing I think that needs re-iterating is that it absolutely HAS to be your best offer, there is no point going back after the deadline to try and increase your offer if you were not successful. I've had buyers try to do this before even though I've explained the sealed bid process.

Good luck

Robert_Sterling_3

Doozergirl wrote: »

We've been in the situation where we've been outbid by someone offering '1 pound more than the other bidder'

What if two people put in such a bid?

MissMotivation

Robert_Sterling wrote: »

What if two people put in such a bid?

Then the Vendor would have to make a decision based on who was the better buyer, i.e bigger deposit, shortest chain, whether solicitors had been instructed and who could complete the quickest.

itsallagame_2

Ah, the Dutch auction.
These are usually at the top of the market to squeeze you as much as possible, at the bottom is cheeky.
3 bidders, lol, could be 20 by Friday, all investment guys looking for a cheap bargain!

Be careful do your research and good luck but don’t offer more than its worth!

spuds_2

All good advice so far. Defo don't offer more than it's worth - a couple on LLL followed Kirsty's advice to bid as much as they could afford, which turned out to be £100k more than the next highest bidder. They only found out when the EA accidently sent them the wrong paper which had the bids on. Needless to say, they withdrew.

There will be lots of repo's coming through now, another bargain will be along soon.

hethmar

We bought this house by sealed bid. Its when there is a lot of interest in a property (it was like a days outing when we came, 3 agents taking parties of people around :eek:) Normally you have a deadline time and all bids are opened at that time. We sat outside the agents with our offer in writing and then added another £650 just before popping it through their door. We got the place by £150. I would also add in our letter we gave details of our finances, our accountants name and phone number and ditto our financial advisers and the fact that we didnt need to sell our property to proceed.

We were told that after the deadline and our bid winning, one chap rang and offered a further £5k but was told it was too late.

You have one chance, do your homework and then put in your best bid.

betheebee

Hi all,
Have just found this thread and wondered if anyone could point me in the direction of a template letter to include with a sealed bid.
We are cash buyers, do not need a survey or search and have a solicitor standing by. Any help much appreciated.

chickmug

betheebee wrote: »

Hi all,
Have just found this thread and wondered if anyone could point me in the direction of a template letter to include with a sealed bid.
We are cash buyers, do not need a survey or search and have a solicitor standing by. Any help much appreciated.

Don't get too bogged down with thinking there must be a 'best way to do it' letter.

Just keep it to:

1) Heading (the house).
2) Amount you are offering.
3) Say your solicitors have been chosen (but don't say the name of the frim) and ready to start work once instructed but hoping it is NOT one of the notoriously slow ones. So maybe a thought to say if this firm were to be a problem you are willing to consider an alternative.
4) Amount of money you have and proof.
5) You will only want the valuation survey and not a full structural survey.
6) You are happy to aim to complete in the time frame to suit the seller.
7) You have no need to sell and explain the reason why. Like in rented or sold and contrcats already exchanged.

So nothing else but surely you don't mean that you will not ask for searches???

betheebee

Thanks Chickmug, We wont need a search as we know the cul de sac and the houses very well, we own another not far from the one we are going to put a sealed bid in for.
We are biding 125k, research shows that an identical one is valued at 235k. The one we want to buy needs cosmetic updating but is sound otherwise.
Off to phone solicitor and have them on standby.
Thanks again.