Opening offers for a FTB

BeccaBell

Thanks to an earlier thread I have discovered I am a bit of a rare creature (a FTB with a firm mortgage offer) and also that just because something has OIEO oe OIRO does not mean the vendor has recieved this already (as I was lead to believe by an estate agent I am very glad to no longer be dealing with). Just as a guaging a question If I were to offer £169,950 on a property with a guide price of £179,950-£189,950 am I putting myself so low the vendor wont take me seriously? I doubt they'll accept but I want to see if they are open to negotiations. As far as I am aware they have recieved only one offer in 3 months and the EA described it as "laughable".

Thanks in Advance

Plans_all_plans

The property we have bought was on for offers over 110k. Our opening offer was 92k, second offer 96k, the agent said if we went to 100k we'd have a deal and we said our max offer is 96.5k take it or leave it. That offer was accepted.

This was less than a month ago. I would be knocking more than 10 grand off for my opening offer in your position. Have you checked sold prices in the area in which you are looking?

Wee_Willy_Harris

If you're going to be aggressive (offer wise) then go even lower. Always easier to increase an offer than reduce one, even in this market. And, if the EA even just gets you to what the original offer had been, he can feel that he has negotiated a good price... everyone's happy. Might be worth trying 165k and see what happens. The worst they can do is say "No".

BeccaBell

The prices vary hugely from where I have checked on Zoopla and nethouses from £188,000 to £153,000. As far as I can see the last property to sell in the area was for £154,000 and that was in Feb of this year.
If we were to go as low as £165,000 is this a reasonable opener looking at the asking price?

Idiophreak

I agree...if I was a FTB, finances approved, no chain...I'd start from 10% under, so £165k max...

Wee_Willy_Harris

The reasonableness is for YOU to decide. You don't know how desperate they are to sell, what the vendors personal circs might be etc... and, to an extent, why should you care? He's had 3 months of morgage payments to meet since it went on the market, he may have already committed himself to another property, may even already be paying for that as well. You are a FTB with a mortgage in place, you can offset any reduction with the attraction of a quick(ish) sale and no chain to slow YOU down. Ignore the guide price, that's what the estate agents have told him to do, you do whatever is in your best interests. And remeber, every £1 you get off the asking price is worth about £3 to you over the course of a mortgage. In the current uncertain market I'd say "Go for it!"

Plans_all_plans

I would personally open at 159,950k, with a view to going up to 169,950, but no higher. If last comparable house went for 154k, I'd want to know why this one's on for so much more.

We eventually went for the house with the most motivated seller, as we got more off them than we would have done otherwise. We had a few offers refused, but we wouldn't go through the ceiling we'd agreed to.

BeccaBell

Thanks very much for everyones advice! Much appreciated! I feel much more confident about my position now. We have also been informed that though it is advertised as having a loft the loft technically belongs to the freeholder and though we can use it for storage anything up there is not insured. Surely advertising the property as having a loft is rather misleading as it wont be owned by us?

Wee_Willy_Harris

BeccaBell wrote: »

Thanks very much for everyones advice! Much appreciated! I feel much more confident about my position now. We have also been informed that though it is advertised as having a loft the loft technically belongs to the freeholder and though we can use it for storage anything up there is not insured. Surely advertising the property as having a loft is rather misleading as it wont be owned by us?

Misleading? Maybe. But who's going to take ownership of a roofspace above your property with no access to it other than yours? Handy weapon to beat the price down, though.

BeccaBell

The problem with us is the area, we are in Surrey and your average two bed is £200K plus. I think the one that went for £154k could have only been a 1 bed the info on the sites is not very concise. By going in too low am I alienating the seller though. If some one came in way below asking would it not make you disinclined to do business with them?
Also is it odd the vendor refuses to be around whenever we have gone to look? Is this quite normal? All other properties we have been to (15) we have met the owners.

Wee_Willy_Harris

Some owners don't mind viewings, some do.

As for alienating buyers? I wouldn't worry about it. Whatever you offer, it IS just your first offer. I would expect the EA to come back with some encouragement, they get paid for the sale after all. If you meet a price they can agree to, you won't be "alienated" as, at the end of the day, they want to sell the place and they won't really care who to. Same as you don't care who you buy from.