Three Buyers Are After My House !

eeja

Please advise. Am selling through an estate agent and there are three buyers after my house. They keep on putting in higher and higher offers by bidding against each other . [At the moment there is no comparable property on the market in my post code area at a price anywhere near as low as mine.]
Now the agent is advising me not to take higher offers or push the price up further as he is concerned a buyer whose offer I might accept will not be able to raise the necessary finance to buy the property and any deal could fall through and I could be left high and dry without any buyer at all .
What is your opinion of this advice ?
Do people nowadays put in offers they cannot afford ?
Is this occurance common ?
Is it sometimes bad policy to go for the highest price ?
Why should the estate agent working on a commission want to put me off seeking the best price ?

nearlyrich

Has he got a vested interest in one of the lower bidders getting the house?

dharm999

eeja

If it was me in your position I would get all three to put in best and final offers in writing to and then choose the best one. At least that way you stop all the out bidding of each other, and get rid of the risk that your buyers find somewhere else they are interested in buying. As for can they afford to pay it, find out what each of the buyers position is, e.g have they already sold their property, are they cash buyers, etc.. Also ask the estate agent to make sure that all the interested parties have their finance in place, that way you'll know how serious they are and if they can afford your house.

Spendless

This happened to me in 2003/4 but the market was mad here then. What my EA did was check that those who were offering were actually in a position to buy, very roughly of course cos someone could earn a lot but not have much disposable income. The buyer who said he was cash the EA did say he'd want to see proof before telling me he was a definate cash buyer.
Don't really understand why the EA would advise you not to take any more offers

Poppy9

How many valuations of your house did you have before you put it on the market? Has your EA undervalued it for some reason.

Find out all buyers positions and hopefully get the most secure buyer (if there is such a thing!) to match the highest price.

clutton_2

have you checked on https://www.rightmove.co.uk "sold prices" for the selling prices as per Land Registry data of the houses which have actually sold in your area in recent times ?

Xbigman

There are actually two issues here.

Is your house undervalued? As already suggested its not hard to get a rough guide to prices but if its the cheapest in the area a mini bidding war is quite possible.

Who to chose? The EA should be able to get the details of each prospective buyer. Pass the details of whoever looks best to your solicitor, who can get in touch with the buyers solicitor and check out everything is solid.
Your EA is right about not just accepting higher and higher bids. The failure rate on these higher bids is very high. People become desperate and run their budgets to zero or they allow for their,as yet. unsold property to get the full asking price. My advice, don't be greedy but go with the best and not highest offer.
Regards


X

steve_cov

Sealed "best and final offers" (the technical term) seem to be the right way to go, as dharm999 has already suggested. You could also ask simultaneously for proof of status (mortgage offer etc.) to be provided to the agent with such offers.

The scope for further delay is not good for you or the interested bidders.

fatblokexl

up here in scotland it is the norm that you put a house for sale at "offers over" £xxxxxxx, the price the house is advertised for is the EA judgement but normally just under the valued figure, buyers offer there 1st bid which typically is 5% more than the listed price and then you can reject it and hold out for someone else to bid higher.

example:
our old home was valued at £55k
EA advised we advertise at £49k
bids came in and we accepted £60k, a decent profit of £11.5k since we originally bought it 3 years prior to selling it.

i know in england it is different, you normally start at the max and buyers will offer less so i can only think in EEJA case the EA is looking out for you big time by feeling/knowing these high offers cannot be honoured, as if the deal falls through so does their commission.

i would suggest that if any buyers go for a survey and a decent one then they are pretty serious or depending on how quickly you need to sell take an acceptable offer to YOU and not what the EA wants you to accept. it is always a good idea to go to best and final offers as only the serious contenders will be happy at that and offer accordingly

linlin_3

Accept the two highest offers subject to exchange. The first to deal with legalities, gets the house.

Debt_Free_Chick

eeja wrote:

Now the agent is advising me not to take higher offers or push the price up further as he is concerned a buyer whose offer I might accept will not be able to raise the necessary finance to buy the property and any deal could fall through and I could be left high and dry without any buyer at all .

He may be right

If the offer price is too high, then the mortgage valuation may come in closer to what the EA valued it at. If your buyer is relying on a 95% mortgage and has no other cash, they will probably find that the mortgage offered to them is insufficient - so they won't be able to go ahead.

When you put the house on the market, did you get valuations from three or more EAs? Which one did you go with? How long ago was this?

Either, your asking price was too low or you have a bunch of emotive buyers - one or more of them may be dependent on a 95% mortgage in order to complete. Your EA should try to ascertain the level of mortgage each buyer needs. Personally, I would go with the one who needed the lowest LTV, provided they were also in a strong position to proceed i.e. not in a chain or in a short chain, having sold their current property.

Not easy .... the EA may well have a point here.