Making an offer: 18% off asking price reasonable?

purple101

Last weekend we viewed a 4-bed detached house (built 2002, £222k at the time) with a current asking price £400k. We liked the house and are now thinking of making an offer. We did some research online on the sold house prices nearby, there are not that many with similar size, so it is hard to compare.

The most recent one was sold in 2010 for 370k - same floor plan on the same close, but with a detached garage and at ground level, while the one we looked at is on a slope so the garage is under the house. There are stairs with about 20 steps up from ground level (garage) to front door.

Another sale of the same house style again in the same close was for 345k in 2006.

Another house we viewed very recently is brand new with 5/6 bedrooms for £375k is located about 0.5miles away with a similar overall floor area and plot size, same school catchment, etc.

We are thinking of submitting an offer for £330k because of the similar properties we see have sold and are selling for less and because there are no internal stairs leading up from the garage (inconvenience in bad weather and increasingly with age).

Another reason for this price would be that the bathrooms (family bath and en-suite) and kitchen are starting to look dated, which we would want to refurbish. Energy efficiency may also need to be looked at, in particular a new boiler and floor insulation. The vendor has pets (both dog and cat) in the house, so that we will need to replace all carpet before moving in (house is about 1800 sq. ft.)

We have no chain and have all legal/mortgage/finance documents ready, but it appears that the vendor hasn't really started looking (waiting for an offer first, probably to know their budget). They say they are not unhappy there, but want a change. Downsizing may play a small part since their children are all grown up, although two apparently still live with them and it wasn't explicitly mentioned. They won't be making a loss either way considering their original purchase at about 222k.

Is an offer of £330k reasonable given the above reasons and circumstances?

Fire_Fox

Welcome! You need a lot more information about land registry sold prices from the last year, look at larger and smaller properties or the area instead of just the street. Do not compare to for sale prices.

purple101

Thank you for your very quick reply. We just checked the land registry for the local authority. The average sold price for detached houses has dropped about 10% since 2010.
There are several smaller 4-bed detached houses sold for between 240k-300k in the area in 2011 or even 2012 (March), but without knowing the exact size, is there any way to make a fair comparison?

SG27

I've seen houses that would pay the asking price because they are priced well. I've also seen houses where I wouldnt make an offer of 50% off!

It sounds like you have done the right sort of research and worked out what it's worth to you so I'd say go for it! Be prepared for a no though, some people are very deluded when it comes to the true value of their houses!

Fire_Fox

Use Google Street View for some idea of size or go visit the area again. Don't look at the whole local authority, prices will vary massively within that. This is not an exact science, it's a case of doing as much research as you can before deciding what the property is worth to you.

freefreak

I used Zoopla when looking at the last purchase price and purchase prices of similar properties in the area. Type the postcode into their search and it should come up with the sale history

tobyjug

I think you really need to discuss this and your offer with the estate agent. We moved at the end of last year, there weren't many for sale houses in our new area. We had to drop our own house by 10 % in order to sell so offered £320,00 on a £365,000 house and finally agreed on £335,000 which we felt was fair.

We couldn't believe it when our neighbours have put their house on for in excess of £500,000 , they truly are "testing the market"

I say put the offer as you are in a position to proceed, chances are you will have to go up at that low a price. But if you talk it through with the estate agent and tell them why you think it is worth that much then it will help them.

I think their selling history , how long they have been on the market, why they are moving etc will be just as important as the price.

Mickygg

Offer what you think it's worth. However don't be surprised with a swift no.

purple101

Thanks everyone for your input. We are not that good with negotiating a price on the phone or in person even though we have our reasoning thought through, so thinking of giving the offer in writing. Is it a common thing to do this? If so, what are the important things to mention on a written offer?
A few things we've thought of:
- no chain
- funds in place with the mortgage agreed in principle
- in a position to instruct a solicitor immediately upon the offer being accepted.
- subject to contract - all future and current viewings are cancelled, the property is withdrawn from the open market immediately
- to include fittings and fixtures
Any other suggestions for our case would be greatly appreciated.

Fire_Fox

I put offers in writing and know of others who have done the same, but it is not commonplace. Don't forget subject to survey and the address of your conveyancer. You need to specify fixtures and fittings if you mention them - do you mean carpets, white goods, curtains? Also do you have any queries?

SG27

breadlinebetty wrote: »

So you want £70k knocked off a £400k house, because YOU'VE decided that's how much it's worth?:rotfl:

And you have the audacity to say that as the vendors bought it in 2002 for £222k, they should be happy with your offer as they shan't be making a loss.:rotfl:

I guarantee they'll laugh their heads off at your ridiculous offer - it's not far short of a quarter off the asking price what you want to offer:rotfl:

As your offer is so reasonable perhaps as a goodwill measure they'll throw in a new car with the house you should ask them if they'll do that. And ask them if they'll also buy you shopping vouchers to cover the cost of new carpets, paint, emulsion, and a kitchen/bathroom to your own specifications!

I think you're a wind up.

Have you got a link to this property? You can write it out you know!:)

Oh, by the way, have you not considered ofering on all the £330k houses that you've seen in the area, that are just as nice as this £400k one? Hmm?

What a ridiculous post!!