Advice when submitting offers (FTB)

playaz

Hi guys,

I am a first-time buyer that is looking to purchase a property between 100 - 130k within the West Midlands.

I know there are many factors involved but i'm not sure about the 'going-rate' for offers - obviously I would never offer the advertised amount but what would everyone suggest?

For instance - a property advertised at 130k, would it be rude of me to put in a bid of 115k or 120k?

Any advice would be appreciated

SG27

It definitely wouldn't be rude to offer that much. The agent estate agent will try to pressure you higher and even make you feel silly for offering below the asking price but just stick to your guns. We have lost out on houses because the agent told us at viewings that the vendor wouldn't accept offer below a certain amount then a few months later it selling for less than that and less than we would have paid!

Don't let agents intimidate you. Stick to your guns.

DVardysShadow

There is no formula linking asking prices, first offer prices and deal prices. Some houses at 130, you might feel are worth 130, others you might feel are only worth 110. It depends on how keen the seller is to sell.

Now if you do decide to offer, you first need to decide your walk away price where for £1 more, you would not buy. And then offer less because the first offer will be rejected.

Nynaeve

There are a few things you can check when thinking about how much to offer.

Check Rightmove sold prices for how much similiar properties went for in your area. There are even photos with some of them so you can make a good comparison between them and the one you want to buy

http://www.rightmove.co.uk/house-prices.html

You can check similiar information on websites like NetHousePrices which will give you a selling history

http://www.nethouseprices.com/

Also, check out the HPI index between when the house was last sold and now so you can see what has changed since then

http://www.landreg.gov.uk/house-prices

...but all these can only give you an indication. There are SO many factors in play, vendor and buyer circumstance, improvements that have been made, market conditions in your area....

In the end it depends on how much you are willing to pay (and how much the vendor is willing to let it go for!). As others have said, decide your max price before you start negotiating and don't exceed it. And don't be shy to put in a cheeky offer! You can always increase, but you can't really lower your offer!

I'm in much the same position as you, looking at up to 140k in the East Midlands so good luck to both of us. :j

snid

Many people say your offer should be 5-10% below. (117-123K on a 130K) The more agressive say 15% or more! Depends on many factors - as other posters have said.

On a £130K property I would not be embarrassed about offering £115K, you can always increase your offer. but a higher offer may be more advisable if you're really keen to secure the house and you think there may be other bidders.

Look at this post for a possible vendor's view!
https://forums.moneysavingexpert.com/discussion/3828877

MoneySaverLog

Do some research, check the area out, what are similar houses going for in the area. How long has the property been on the market, what is your maximum. Try to find anything that will put you in a strong bargaining position. Don't jump on the first house you see. Put a offer in well below the asking price,often they overprice the house knowing you're going to do this. Also any offer you make does not have to be accepted, then again it might. If it's not, don't be tempted to up the offer, move on.

playaz

Thanks for all the really good advice guys! I feel much better now - think I have been listening far too much to the estate agents! I will certainly be looking to put in bids around 15-20% lower than the asking price even if the agents themselves think its cheeky!

DVardysShadow

MoneySaverLog wrote: »

Also any offer you make does not have to be accepted, then again it might. If it's not, don't be tempted to up the offer, move on.

Don't take this too seriously. It is almost a formality that the first offer is rejected, so start by offering less than your maximum for that property. Negotiate up to you maximum for that property, then move on.

As I see it, to get a first offer accepted, you'll have to go in a lot higher than the 2nd or 3rd offer which would be accepted on the same property. So it's not good moneysaving.

MoneySaverLog

DVardysShadow wrote: »

Don't take this too seriously. It is almost a formality that the first offer is rejected, so start by offering less than your maximum for that property. Negotiate up to you maximum for that property, then move on.

As I see it, to get a first offer accepted, you'll have to go in a lot higher than the 2nd or 3rd offer which would be accepted on the same property. So it's not good moneysaving.

Then again if there is no further offer, the seller after a period of time might go back and see if the offer is still on the table and accept it later.

bluebird

A property is only worth what the buyer is prepared to pay for it,so do your homework and goodluck.