How much to offer?

ftb-soon

This concerns both the mortgage and the process of buying a house so feel free to move it if required.

I am a first time buyer and have been saving for a deposit for the last 9 months and am just about there. I will have the required amount before I have to pay my deposit with enough for fees etc as a backup. I have spoke to a financial advisor who gave me some good advice, although the best mortgage he could find for me, based on a 10% deposit, didn't seem as attractive as the one my bank (Natwest) is currently offering.

So I went to see the bank yesterday to have a chat about whether obtaining this deal from them would be possible, and the woman I saw said I would have no problems getting a mortgage from them. The house I am looking at is on the market for £95k, my salary is £36k so is affordable. Because I'm an advantage gold customer I would get a rate of 4.64% which is the lowest I can find for a 10% deposit, it also has no arrangement fee which is a bonus.

I asked the advisor "what happens next?" and she said to find a property, which I kind of have (going for a second viewing tonight) and put an offer in, then go back to the bank if it's accepted. From what I have read, I thought I would need an agreement in principle. Does this seem right before I put an offer in?

Secondly, the house I am looking at is on for 95k. It has been on the market since April last year with no offers from 8 viewings, I can't understand why! It's a really nice house, I hope it is just the way the market is rather than something fundamentally wrong which I'm missing! The town I live in hasn't really suffered as part of the drop in prices, but nothing has been selling, the same houses from Aug/Sep last year are still on the market.

Given that they've had no offers and they are wanting to go travelling in the summer, how do I pitch my offer?

Obviously there'll be differing opinions on this one, just trying to gauge what people would think is a sensible offer.

Thanks
S

goldengirl28

hiya ftb-soon,

i've asked a simular question this week, one piece of feedback was to offer what you think the property is worth and also if you don't feel embarrased by the offer its probuably too high.

do your research on other properties in the area to guage the interest.

there was also a really useful thread about buying a house, that someone referred me to................i'll dig out the link and post it here ....if no one beats me to it

good luck.............its nerve wracking this buying lark

goldengirl28

here you go

http://forums.moneysavingexpert.com/showthread.html?t=1907059

Arthritic_Toe

ftb-soon wrote: »

The town I live in hasn't really suffered as part of the drop in prices...

This sounds like a classic line from a party with a vested interest - every estate agent in every town comes out with this one. The fact that houses aren't selling implies something different. You are in a strong negotiating position - make the most of it. Presumably the previous 8 viewers have concluded that the asking price is too high. Bear that in mind when you make your offer.

ftb-soon

Just offered 87k, will wait and see what happens!

ftb-soon

Arthritic_Toe wrote: »

This sounds like a classic line from a party with a vested interest - every estate agent in every town comes out with this one. The fact that houses aren't selling implies something different. You are in a strong negotiating position - make the most of it. Presumably the previous 8 viewers have concluded that the asking price is too high. Bear that in mind when you make your offer.

It's a true statement, I've been watching house prices and they havent really suffered

DVardysShadow

ftb-soon wrote: »

It's a true statement, I've been watching house prices and they havent really suffered

Where have you been looking? The prices in the Agents' windows are not 'House Prices' as they are generally understood.

ftb-soon

Various estate agenst and houseprices.co.uk etc.

They've rejected my 87k offer. Spoke to estate agent who said they want closer to the asking price, but how much? He's going to speak to them now to see where they wanna go with it

dgerati

I'd not budge and leave the ball in their court, let them stew. It's been on market for that long and no offers, so I wouldn't be in any hurry at all...

Easy for me to say though, I'm not involved in anyway!

Fire_Fox

Have you researched land registry sold prices for the street and area?

Arthritic_Toe

dgerati wrote: »

I'd not budge and leave the ball in their court, let them stew. It's been on market for that long and no offers, so I wouldn't be in any hurry at all...

Easy for me to say though, I'm not involved in anyway!

Agree - they will nearly always reject the first offer initially. Nerves of steel required - stand firm. Its not like anyone else is about to rush in with a higher offer.