Making an offer

jonny_power

So we've found a really nice house, we're FTBs and have a mortgage agreed in principle. Going for a 2nd viewing tomorrow with the parents and then we're likely to phone up the EA on Monday to make an offer. The house is on for £140k (as are almost identical properties on the road) but this is generally expensive for the area. Most houses are in the 110-130 bracket, comparable houses are at about the 130 end. The road is nice though and location is good which is why were keen.

Anyway, someone said "unless you feel embarrassed then your first offer is too high" which seems good advice, however for my very first ever offer I'm keen to be able to stand my ground and will need to justify why we've said £118 (roughly what we'll probably offer). Any suggestions for what we should make our primary reason for going in with (such) a low offer? Personally there's so many factors to consider that it's the sum of all of them rather than one main reason. Any advice really useful. Also, I assume you just ring up and make the offer... I'll ask them if accepted to cancel viewings and take the property off the market. When do you make a written offer??

Thanks

kingstreet

Check what other property has gone for by putting the postcode in here;-

https://www.houseprices.co.uk

It may give you an idea of where you'll end up on the price scale.

kingstreet

jonny_power wrote: »

When do you make a written offer??

You don't. If your verbal offer is agreed, the agent issues a written sales memorandum to all four parties confirming the full details. That's vendor, purchaser and both solicitors.

jonny_power

kingstreet wrote: »

You don't. If your verbal offer is agreed, the agent issues a written sales memorandum to all four parties confirming the full details. That's vendor, purchaser and both solicitors.

Is it worth instructing solicitors now, or just when an offer has been accepted? My mortgage broker has said he can arrange this for us.

kingstreet

jonny_power wrote: »

Is it worth instructing solicitors now, or just when an offer has been accepted? My mortgage broker has said he can arrange this for us.

I get three quotes for my clients, so they can see a cross-section of the costs that are likely. I use firms a town or two away as they can sometimes have a fee scale for those from that town, and another for those coming a bit further.

I know this sounds crazy, but Stafford solicitors all charge within a fiver of each other, so I would use a Cannock solicitor who charges less. On a Cannock case, I use a Stafford firm. I know it sounds barmy, but it seems to save around £150 a case.

No need to instruct until your offer is accepted. Solicitors will send you a confirmation of instructions form with your quote. You need to complete that and send it back to them with all the details when you want them to start. The selling agent will need your solicitor's details before the sales memo can be issued, so it may be worth getting your quotes and having in mind who you want to use, before your offer is accepted.

jonny_power

kingstreet wrote: »

I get three quotes for my clients, so they can see a cross-section of the costs that are likely. I use firms a town or two away as they can sometimes have a fee scale for those from that town, and another for those coming a bit further.

I know this sounds crazy, but Stafford solicitors all charge within a fiver of each other, so I would use a Cannock solicitor who charges less. On a Cannock case, I use a Stafford firm. I know it sounds barmy, but it seems to save around £150 a case.

No need to instruct until your offer is accepted. Solicitors will send you a confirmation of instructions form with your quote. You need to complete that and send it back to them with all the details when you want them to start. The selling agent will need your solicitor's details before the sales memo can be issued, so it may be worth getting your quotes and having in mind who you want to use, before your offer is accepted.

great stuff, that's incredibly useful. Will start getting some quotes together.

harrup

jonny_power wrote: »

So we've found a really nice house, we're FTBs and have a mortgage agreed in principle.

.... however for my very first ever offer I'm keen to be able to stand my ground and will need to justify why we've said £118 (roughly what we'll probably offer). Any suggestions for what we should make our primary reason for going in with (such) a low offer?

... I'll ask them if accepted to cancel viewings and take the property off the market. ??

The only valid rationale you'd have is if you check zoopla's sold prices and find that this house sold for 118K or less in, say, 2006 and had no improvements since then.

Otherwise the EA will not take you seriously.

As to your second proposition - how likely do you think your vendor is to agree to this unless they are mental? Just imagine that this is YOUR house: someone offers you 17% less of the AP and immediately demands an exclusive purchase right for it. Whilst retaining the right to change their own mind at any moment.

I don't mean this nastily - but I'd just laugh at you and I would refuse subsequent viewings.

Never forget: to buy and sell a house is a MUTUAL BEFEFIT thing.

TOBRUK

When you have your second viewing (today) don't show all your cards - don't show that you really love the house and you really want it! You can give positive feedback without showing your feelings about the property - the EA could tell the vendor when you put in an offer that they could hold out for a bigger offer!

Do not be embarrased about an offer you make. You say other (similar) properties in the area have been going for 110-130k (is this recent prices?), you need to remember to try and cost out (roughly) how much you would have to spend on the property - be realistic.

When you put in an offer - if it is an offer say at 109k for example, you can say why you think it is a fair offer as this needs work on and it needs this doing and that etc.

What is the situation with the vendor - why are they selling? Ask them (if they are there at viewing) face to face and watch their body language - you may be able to tell if they are being truthful. They may need to relocate as soon as possible, they may have to sell because they can't afford repayments, they may be splitting up - there are many reasons!

Remember, the house is only worth what someone is prepared to pay for it!;)

hcb42

jonny_power wrote: »

Any suggestions for what we should make our primary reason for going in with (such) a low offer?

Only you can know why you are putting in this offer, not a bunch of strangers on a forum who haven't seen it

jonny_power

TOBRUK wrote: »

When you have your second viewing (today) don't show all your cards - don't show that you really love the house and you really want it! You can give positive feedback without showing your feelings about the property - the EA could tell the vendor when you put in an offer that they could hold out for a bigger offer!

thanks, we will definitely play it cool. when we viewed it we (both) got the feeling that they have already found a house although they tried to be coy about it. I'll get my mum to ask them about their circumstances to see what they say.

Do not be embarrased about an offer you make. You say other (similar) properties in the area have been going for 110-130k (is this recent prices?), you need to remember to try and cost out (roughly) how much you would have to spend on the property - be realistic.

When you put in an offer - if it is an offer say at 109k for example, you can say why you think it is a fair offer as this needs work on and it needs this doing and that etc.

it doesn't need a huge amount of work, only minor cosmetic stuff which is probably why the AP is slightly higher, however our offer is within the range of prices that houses have been sold for within the past year or two.

What is the situation with the vendor - why are they selling? Ask them (if they are there at viewing) face to face and watch their body language - you may be able to tell if they are being truthful. They may need to relocate as soon as possible, they may have to sell because they can't afford repayments, they may be splitting up - there are many reasons!

Remember, the house is only worth what someone is prepared to pay for it!;)

Again this is what is it comes down to, we just got that feeling that they were keen to sell and that's what's driving us to put a low offer in. if we hadn't have got that feeling we may not be looking at going in so low (and we are happy to pay a bit more than our offer).

We'll make the offer and say our reason is that is comparable for the prices of other sold houses in the area and just take it from there...

jonny_power

harrup wrote: »

The only valid rationale you'd have is if you check zoopla's sold prices and find that this house sold for 118K or less in, say, 2006 and had no improvements since then.

Otherwise the EA will not take you seriously.

As to your second proposition - how likely do you think your vendor is to agree to this unless they are mental? Just imagine that this is YOUR house: someone offers you 17% less of the AP and immediately demands an exclusive purchase right for it. Whilst retaining the right to change their own mind at any moment.

I don't mean this nastily - but I'd just laugh at you and I would refuse subsequent viewings.

Never forget: to buy and sell a house is a MUTUAL BEFEFIT thing.

I don't want to give away too much info incase the seller reads this but they've been in the house a long time, done a lot of work but will definitely be doing well from this sale. If they were to laugh at us and refuse subsequent viewings, then they deserve what they get...