About to offer on a house... EDIT: negotiation in progress!

Jonny77

vaderag wrote: »

Thanks for all the great advice everyone. The property in on at £250k, was reduced from £275k (although i'm trying not to take that into account). So people think i should start negotiating at £225? I'm scared that that will come across insulting...

Hi. This is my first post after a long time lurking!

We've sold STC and got our mortgage in place. I've spent a lot of time researching the area we're looking at and in particular two houses that are on the market. One is a 3 bed semi on at £240K. It's got a bit extra to it compared to the rest of the houses on the (very long) street. However it's overpriced and been on the market since May. I've spoken to the EA stating that I'll be looking at an offer around £190K and on that basis I've been booked in for a second viewing...

No offer is too cheeky if you believe it to be a fair price and every house sale has to be considered on it's own merits.

vaderag

Well, first offer went in at £225 and has since been rejected.
I told them i'd sleep on it as to whether I wanted to raise the offer.

I told them the reason for the offer; street prices were lower, state of market etc and emphasised the fact that i'm a FTB, no chain, Mortgage in principle and can move quick, but also in no rush but they came back saying that it was too low.
Said that they only dropped the price from 275 to 250 a week ago and only to get under the stamp duty bracket, so the seller wouldnt be looking to take much below asking at the moment...
To be honest, the house is definitely not worth 275, and I'm not convinced it's worth 250...

However, going to nudge up from my low offer, but no idea where to go with it now! Too little and they'll think i'm a time waster, too much and I may be paying over the odds...

vaderag

So, does anyone have any advice on where I should go with my next offer? I'm thinking 232, but I don't know if that's enough of a jump to be taken seriously...

Loanranger

vaderag wrote: »

Well, first offer went in at £225 and has since been rejected.
I told them i'd sleep on it as to whether I wanted to raise the offer.

I told them the reason for the offer; street prices were lower, state of market etc and emphasised the fact that i'm a FTB, no chain, Mortgage in principle and can move quick, but also in no rush but they came back saying that it was too low.
Said that they only dropped the price from 275 to 250 a week ago and only to get under the stamp duty bracket, so the seller wouldnt be looking to take much below asking at the moment...
To be honest, the house is definitely not worth 275, and I'm not convinced it's worth 250...

However, going to nudge up from my low offer, but no idea where to go with it now! Too little and they'll think i'm a time waster, too much and I may be paying over the odds...

You have answered your own question, see above.
The property has been reduced to sell.
Either you meet the reduced price or be prepared to lose it. It's your choice.

hazyjo

Reduced to sell still doesn't mean it will sell at that price. People still expect a deal of sorts. If you want it, they'll take £240k (I'd bet on that!). If you're happy to risk losing it, I'd slap £232 down and say it's your absolute best offer and all you can scrape together on top of your mortgage offer. Say if they can't accept it right now, to please let you know if they change their minds in the future.

We took £230k when it was up for £250k. Prices are still dropping (in most areas) so I'd be inclined to leave the offer on the table, but to say you're absolutely genuine and really want the house and can they please keep you informed of any developments.

Jx

BornAtTheRightTime

Up the offer to £228k, an additional £3k. They'll probably still refuse but will take longer over it. Then your final offer (and people do expect a 3rd offer to be final) can be a further £1500, ie £229,500 which I suspect you'll get it for.

People say your first offer dictates where you end up with your final agreed price. I believe the jump between first and second offers tends to dictate the agreed price - they'll expect you to add no more than 50% increase each time and will figure out for themselves that your limit actually appears to be £230k, so will accept something very close to that and feel they have had a success in getting pretty much all your money from you.

When people are negotiating they tend to get attached to the negotiations and want to actually agree a price.

bryanb

Bargaining in the middle east (where they are real experts) tends to end up exactly half way between the asking price and the first offer. If not the deal usually falls through.

janbabe

Depends what your maximum you are prepared to pay (or can pay) for this house and how much you want it.

If its THE house then you have to know what your max offer will be. I would be inclinded to up it to £232 and tell the agent thats what you want to offer, but your max is £235. May sound bit silly at first offering one thing but telling the EA you can actually go bit higher but EA will relate that to vendor and, of course, vendor will think well I'm gonna go for the higher price and may get it for £235.

Cos if I was selling and EA said buyer is offering £232 but has said their absolute max is £235 which they dont want to really go to, I would be thinking, ' well I aint taking the 232 but go for the 235'.

Up to you where you want your next offer to be, but bear in mind your 3rd offer will most prob be your final one and I would still say, if the answer is no, to the EA that is your final offer and you will give vendors a week to accept before you proceed with your house hunting, but you are a buyer who can complete quickly, no chain etc. Then I'm afraid you may have to sit back and wait - or just let go altogether.

Fingers crossed for you.

Orpheo

janbabe wrote: »

Depends what your maximum you are prepared to pay (or can pay) for this house and how much you want it.

If its THE house then you have to know what your max offer will be. I would be inclinded to up it to £232 and tell the agent thats what you want to offer, but your max is £235. May sound bit silly at first offering one thing but telling the EA you can actually go bit higher but EA will relate that to vendor and, of course, vendor will think well I'm gonna go for the higher price and may get it for £235.

Cos if I was selling and EA said buyer is offering £232 but has said their absolute max is £235 which they dont want to really go to, I would be thinking, ' well I aint taking the 232 but go for the 235'.

This is entirely bad advice.

if the answer is no, to the EA that is your final offer and you will give vendors a week to accept before you proceed with your house hunting, but you are a buyer who can complete quickly, no chain etc. Then I'm afraid you may have to sit back and wait - or just let go altogether.

Fingers crossed for you.

This is not bad advice, except for the part about continuing your house-hunting after a week. Put your offer on the table with a time limit, but indicate that you will still be viewing houses in the meantime. Back this up by arranging a viewing or 2 with the same EA.

Loanranger

Vadereg
You should know that several people giving you 'advice' here are not homeowners, never have been and never likely to be.
They belong to a group whose aim is to talk down houseprices in the vain hope that one day, over the rainbow, they might be able to make a killing in the property market. They include Tawse57 and Brit1234.
They invariably leap onto posts from first time buyers and try to give you bad advice that will result in you losing out on a property that you want to buy.
My advice is to follow your own instincts and not be swayed by folks who have no interest in your situation.