House Buying - Moneysaving Tips

jimmy_stewart

Advice needed. Have just put in an offer of £83k on a £86k property. End terrace. Buying with daughter so we are effectively first time buyer. House has been on market for a few months and seller very keen to sell. House 2 doors away is a semi and is under offer. It was on market at £84500 and is a better house.

Don't know if our offer has been accepted yet but suspect it will. Thinking about it our offer is 96% of asking price when advice on here appears to be anywhere between 10-30% less initially.

Two questions:

1. We are not timewasters as like property but houses sold in same street six months ago and the semi suggest we have have overbid. If offer is accepted what scope have we got to reduce offer and what to?

2. Semi is "under offer". I guess that could mean contracts signed but for sale sign still up. What is process for seeing if this is still available? Just ring agents I guess? How often do "under offers" fall through?

Thanks

AndrewSmith

Hi,

Answering in order that you ask

1) At the end of the day only you know what is or is not a fair price to pay. You will find people everywhere who will suggest that you should pay 80% etc, however you are the one who has seen the house and know in your mind what you are prepared to pay for it. It also depends on how badly you want the place. It is usually rather difficult to reduce an offer without evidence of overpricing such as a survey etc. If the seller does agree to reducing the offer you will likely find that the Estate Agent will advise them to keep marketing the property in the hope of a higher offer. There is no contractual requirement for a vendor to stop marketing a house when an offer is received or accepted.

2) 'Under Offer' generally means that the property has an offer on it that is acceptable, but not proceedable. However different Agents use different terms for the same thing. May be worth giving the agency a call to see what the situation is with it.

Hope this helps

Andy

babysaver

I'm buying in Scotland which seems to be the opposite of the pricing system in the rest of the country! The houses are marketed at "offers over" and the expectation is that the bid will be at least 10% over that e.g. o/o £90k - bid expected around £99k. I want to bid on a property I've seen over the last few days but want to sound out the estate agent to see if the buyer will accept my offer before I pay for surveys and solicitors - does anyone have any experience of buying in Scotland? What is the likelihood of the EA confirming whether buyer will accept the offer?

Thanks!

Property_Magnate

Jimmy,

It is difficult to advise you without getting some more details. It would be useful if you could share the following information with us:

1. What is the monthly rent for similar properties in the area?
2. Type the property postcode into nethousprices.com or houseprices.co.uk and write down what similar properties have sold for over each of the last 5 years.
3. What are the sellers details: Do they live there or are they investors. When did they buy and what did they pay. Are they in a chain etc. ie. how desparate are they to sell?
4. Is there competition from other buyers? If not, can you wait? Asking prices tend to rise in the busy spring season. You will get a better deal at the end of the summer. The market could well be spooked by Mervyn Kings comments last week and the prospects of an interest rate rise. Reading the Sunday papers today may be an eye opener for some!
5. Given the possible future direction of interest rates could you comfortably afford the monthly payments?

Thanks.

Eels100

babysaver wrote:

I'm buying in Scotland which seems to be the opposite of the pricing system in the rest of the country! The houses are marketed at "offers over" and the expectation is that the bid will be at least 10% over that e.g. o/o £90k - bid expected around £99k. I want to bid on a property I've seen over the last few days but want to sound out the estate agent to see if the buyer will accept my offer before I pay for surveys and solicitors - does anyone have any experience of buying in Scotland? What is the likelihood of the EA confirming whether buyer will accept the offer?

Thanks!

I'm in the middle of doing the same, and I didn't realise initially that it's expected for you to haggle here. I basically asked the EA what offer would be accepted, then offered a bit less, but the whole process was complicated by an inept EA who kept getting my offer wrong and taking the wrong figure to the vendor.

My advice would be to try your best to speak directly to the vendor and agree on a price with them. I was unable to do this as my property was empty :undecided but it would have made life easier. Don't fall into the trap of asking your solicitor to note interest (unless you're in a mega fast-moving market) because that's just a way for the EAs to force interested parties into a closing date whereby everyone cashes in except the buyer.

babysaver

Thanks Eels100. I viewed the property again last night and tried to find out how much the vendor was looking for but I think they're under strict instructions from EA not to discuss this with viewers! I'll speak to EA today and tell them how much I want to offer before I involve my solicitor. I didn't know that noting interest in the property would result in a closing date so thanks for that bit of advice...

gromitpet14

Hi

Just thought I'd update you after reading this info which has proved very useful. Just had my offer accepted on a house in Macclesfield. Was on market at £114,950, previosuly on at £118ish but reduced once. First offer was a very cheeky £90K, which was point blank refused and I was told "at least a 3 figure offer". Found on Rightmove that she had previously bought house at £111,000 2 years ago. Let things calm and then pleaded £97K which was again turned down. Final push was to plead that my parents had lent me the extra 3 grand but no way could I go any further. Estate Agent tried his little trick of "there is a viewing this weekend which she wants to see if they make an offer first", and yes, it drove me mad all weekend but didn't pester agent and they've accepted my offer - hooray, with blinds/carpets/curtains included!!!! Hugh 15K saving.

I've had my mortgage sort of agreed in principle, and my mortgage company offering me 2 types of valuation/survey. Basic at £190 or Homebuyers Report at £335. As the house has been empty for a while and is an oldish house I thought of the homebuyers report and they said it would check the gas/electric/water/drains/damp/subsidence for me which would save time and money getting electrician/plumber/builder to check this before I moved in. What does anyone think??

Why are the fees so much too. I've gone for a 2yrs fixed at 4.75% and its £499 acceptance fee, £35 to release funds (what a load of c**p and £25 to have insurance with another company (I know most insurance companies will refund this anyway). Why do they cost so much. It's so expensive. Is there any room to haggle on this do you think. As me and my partner are splitting I decided against changing company as they are been quite good sorting me out with a mortgage even though the 'transfer of equity' hasn't gone through yet so I'm sort of on 2 mortgages. Do you think I could shop around withough applying and get them to reduce some of their fees??

I've started to email sols, and the mortgage company gave me a quote of £468.83 plus the cost of the land regs fees/searches, but didn't say how much this is. Any ideas anyone?

Any help greatly received. Email: rachelcollier14@tesco.net

I'm just waiting for my Equifax credit report and my mortgage company advised me to put in a covering letter if there was anything 'concerning' in my credit report explaining how I am going to sort it out and it would be looked upon 'favourably'.

Rachel:beer:

Property_Magnate

Gromitpet14,

Well done for doing some research and potentially saving some money!! Remember, by far the best way of saving money when purchasing a house is by negotiating the price you pay!

May I ask you the following:

1. What is the monthly rent for similar properties in the area?
2. What are the sellers details: Do they live there or are they investors. Are they in a chain etc. ie. how desparate are they to sell?
3. Is there competition from other buyers? Remember, asking prices tend to rise in the busy spring season and there are better deals to be had at the end of the summer.
4. Given the possible future direction of interest rates could you comfortably afford the monthly payments if interest rates were say 8%?


If you are not embarrassed by your first offer it is too high!

Wickedkitten

gromitpet14 wrote:

I've had my mortgage sort of agreed in principle, and my mortgage company offering me 2 types of valuation/survey. Basic at £190 or Homebuyers Report at £335. As the house has been empty for a while and is an oldish house I thought of the homebuyers report and they said it would check the gas/electric/water/drains/damp/subsidence for me which would save time and money getting electrician/plumber/builder to check this before I moved in. What does anyone think??

Definitely get the homebuyers if the property is old, but it really won't check the gas, electric, water, or drains other than saying "it's connected to x,y,z. Also there will be set replies on certain things considering the properties age so don't fall over when you read it and it sounds like the house is on it's last legs, just make a post with the urgent bits and someone will tell you if they are truly serious or not.

gromitpet14

Property_Magnate wrote:

Gromitpet14,

May I ask you the following:

1. What is the monthly rent for similar properties in the area?
2. What are the sellers details: Do they live there or are they investors. Are they in a chain etc. ie. how desparate are they to sell?
3. Is there competition from other buyers? Remember, asking prices tend to rise in the busy spring season and there are better deals to be had at the end of the summer.
4. Given the possible future direction of interest rates could you comfortably afford the monthly payments if interest rates were say 8%?


If you are not embarrassed by your first offer it is too high!

Hi

To answer your questions:

1. My house is a one bed detached. A one bed terrace rented in the same postcode area is between £395-450. A rented room in a shared house in the area is about £415 (semi).
2. The house had been on the market for 8 months, many buyers put off I think by the fact it hadn't got a garden/yard and it was only one bed. Either that or it is falling down and when my survey comes I will panic!!!! The seller was renting in Bristol and had moved out of the area so I think perhaps she wanted to free up the money to buy down there.
3. Think I might just have got in before prices went sky high. HAd previously bee on market for 118,000. In Macclesfield there is a block on any new builds for at least another 5 years so I can only see house prices getting more expensive as there becomes more demand for houses so I could be onto a winner even if I do decide to sell.
4. I would panic a bit if interest rates did rise to 8% like probably most people would!!!! I'd have to get 2 jobs!!!!!

I was soooo embarassed by my first offer, I could almost hear the estate agent laughing!!!!

Racel