FTB - Guide to offer procedure...?

BigAlC

Hi everyone,

First post, and I'm pretty sure I'm going to get some peoples backs up with it, but I want to ask the question anyway.

My partner and I are looking at houses now. We have a DIP from a lendor and went to view a house over the weekend. We've decided to not go for the first one we see, despite it being nice, the vendor was a little aggressive towards us regarding not moving from the selling price and wouldn't stop going on about the view, and how that was the selling point. I found a couple of faults and when questioned he did answer, although again a little short.

We had a walk around the area and have seen a similar house, very nice advert and pictures on the advert, and we are interested in viewing, but the price we saw for this place was ~20% more than a comparable house on the same estate.

Now my partner and I discussed this, and I've been doing plenty of research on prices in the area. I found that it was brought as a new build, and now the vendor is trying to sell at ~5k less than what it was brought for at new.

We were thinking of putting an offer through the door, but it wouldn't be near the asking price, it would be more around the same region as comparable houses have sold for on the estate which would be ~18% lower than asking price.

I'm torn as I realise from a sellers perspective they want to recoup as much as possible from the sale, but from a buyers perspective we want to feel like we have got a good deal in comparison to other properties.

From what I can find, it's only been on the market for 6weeks, I still need to ring the agent to find out about offers made etc.

However, the real question is, at this current time, is it even worth putting an offer down, as it would only have a very finite amount of movement and we would not move up to their asking price. I know the worst they can do is say no, but I wouldn't want to alienate the vendor from us, if it is still on the market in 3 months time.

Thanks for any input.

lincroft1710

If the house is not on the market on 3 months time, then either there is a rather foolish buyer around, or the vendor has seen sense.

If the house is worth say £80K, then offer £80K explaining your offer is in line with what similar houses have sold for. Ask the EA why this house is so overpriced, you may find they know their client has unrealistic expectations.

hethmar

Well, you have said you dont want to buy the first house havent you? Just carry on looking.

hazyjo

Bit confused already. So you viewed one house, didn't want to offer. Walked round, saw another house - which you haven't viewed - and want to offer on it?

Before I babble on too much, can I check that's right?

If you haven't viewed, go view before offering! Will babble on more when I'm clearer on what you're trying to say.

Jx

GAH

From how your post reads, you want to put an offer through the door of this house when you haven't viewed the house, met the vendor or spoken to the agent.

If I was the vendor of that house I would be wondering what the heck you are doing.

Call the agent, view it if you want, then make an offer of what you think its worth. Now depending who the vendor is, they can either say yes or no to an offer. If you make an offer a much lower offer than a vendor expects, you could end up insulting them.

BigAlC

Ok.

To clarify, we will be booking an appointment to view, and I'll do this once I've fed back to the agent about the previous house we have viewed (the houses are marketed by the same agent).

We have a price in mind for the house just going off the advert, obviously post view this could change.

The question remains though, once the viewing is completed, do I write a letter to the vendor directly, explaining our view and position and pop it through the door, or do I go through the agent, who might just read the offer and throw it without the vendor being able to read it completely?

GAH - Your point is what I am trying to elude to, the houses on the road it's on have all been sold for significantly less than this is advertised. Background research displays that it was brought for slightly more (from new) than what it is up for now. There appear to be no alterations to the house from new.

My understanding was that buying a new build is much like buying a new car, once brought it drops a significant amount in terms of resale price?

Given my reading of the area and prices they go for, I don't want to insult or alienate the vendor, especially if the house remains on the market for a prolongued period of time and I approach them again later on.

GAH

Once viewed make your offer to the agent, not the vendor.

Its good that you have done your research to sold house prices in the area as this can be a good justification when making an offer.

Not every new build property loses money.

Remember vendors can ask whatever they want for their homes, doesn't always mean they will get it.

But the same with buying, this house might be worth £x to you but someone else might thinks its worth £y to them.

Do, the viewing and try and feel the vendor/agent out a bit on their position/price etc.

steve1980

Agent: Hello, Joe Bloggs Estates, how can I help you?

You: I've just seen the property in Any Road, could I make an appointment to view it?

A: Of course, when would you like to go?

Y: The weekend would be good, about 10:00?

A: Ok, I'll get hold of the vendor and call you back.....

Agent makes appointment and confirms the details.

Agent: Hello, Joe Bloggs Estates, how can I help you?

You: Hello, I've just viewed the house in Any Road and would like to put an offer in for it. I would like to offer X amount of money. I know it's alot lower but I have also viewed another property which is identical round the corner and on at £20,000 less. I am a first time buyer with my partner and we have our mortgage agreed with (insert lender here).

A: Ok, thank you BigAlc, I'll put your offer forward to the vendor and let you know the outcome.

Agent will then give you good news or not so good news!

BigAlC

So, an update to this.

I rang this morning giving my feedback to the EA about the property we viewed. Mentioned various things, one in particular being about some sharp spikes that had been set up on one of the fences. EA's response was that can they not be removed, to which my reply was, well we asked and vendor didn't know, plus it depends on who the fence belongs to on the deeds surely.... she just mumbled something along the lines of "oh yeah.... suppose so...."

Instantly I wasn't enthusiastic towards her(them)

She asked what sort of price we would be looking at for that home and so I told her. Then I asked for a viewing of one around the corner which was a fair whack higher than our price limit on the previous house, and questioned why I wanted to look considering the price limit I just mentioed. I gave my reasons and she said she would ring the vendor and get back to me.

I've just had the phone call back and she says they and the vendor don't see the point in a viewing when it's more expensive. I can kind of see their point, however, in my view it is overpriced by nearly 50k compared to houses on the same street with no discernable advantages.

Can or indeed should I still chase it considering I'm not convinced the vendor even knows of my interest, and how can I go about finding information about vendors position when the EA seems quite unhelpful?

hazyjo

Agreed - offer verbally through the EA. Phone call is fine.

No need to write a letter, but you can follow it up with a letter if you so wish. They are legally bound to pass on any offers and it's in their interest to do so (it's how they earn their money!).

Still not sure why you were discussing the selling price with the (first) vendor when you weren't planning on offering (as I understand it). If a vendor starts banging on about price, whether you're interested in their property or not, just cut the conversation dead and say if you are interested, you'll be making an offer through the EA.

Jx

hazyjo

Our posts crossed.

Personally, I wouldn't have told the EA my upper limit anyway. If they won't let you view as they want more, all you can do is sit tight and wait for them to reduce the price - obviously there's no guarantee they will though!

You might well believe it's overpriced, but that doesn't mean the vendor is willing to accept that. You also don't know if it's the value the EA has given, or whether they vendor has bumped the valuation up to 'test the market' or if they need a certain price. Don't see why that should be passed on to any buyer, but some sellers do believe they should get a certain amount out of their home rather than what the market determines it's worth.

I'd keep viewing others and forget this unless they drop the price further down the line.

Jx