Negotiating House Prices

faeryty

I'm a eager FTB, and second guessing myself as to what to do - any advice would be appreciated.

The situation:

• Asking price: £120k
• Our opening offer: £108k
• This was rejected, the estate agent indicated £115k was likely to be accepted
• We have an agreement in principle, funds ready for a deposit no downward chain
• The owner is not resident and in a position whereby if she has not agreed a sale by Christmas, she is looking at renting the property instead
• The EA runs a 'free legal fees' offer, whereby if your offer is sufficient then the vendor will pay £1k towards your legal fees (if you use their in house solicitors, which have quoted £1300-1400 including all dispursements, which is roughly in line with other quotes we have got)
• The market in our area is moving quickly, especially for the types of property (i.e. starter homes) we're looking for
• Property has been on the market approx 2 months
• Has had offers from investors around the £100k mark which have all been turned down

At this point, we don't know whether just to roll over and agree to the £115k on the basis that it includes all fixtures and fittings (was a part of our initial offer) and that the seller contributes to our legal costs. We are happy that £115 is a fair price for the property and would be happy to pay it, to ensure goodwill from the vendor.

Alternatively, we don't know whether to offer lower and risk losing out on the legal fees offer or the property altogether.

We just don't want the vendor to turn around and reject £115k because we've agreed so easily. Is this something that goes on in the industry?

All advice welcome!

SleeplessinScandinavia

Sounds like a judgment call for you to make whether its worth haggling or just offering the £115K.

Certainly in my experience, after making an opening offer which is rejected, I've come back with a higher offer (but still below the one the EA says is what they're looking for) and its been accepted

Have you checked sites like www.propertysnake.co.uk to see get some idea whats happening to property prices in your chosen area? Has the price already been reduced?

Although a deal on the legal fees sounds attractive, I personally would rather find my own legal representation (rather than one organised in any way by the EA).

Best of luck

poppysarah

faeryty wrote: »

I'm a eager FTB, and second guessing myself as to what to do - any advice would be appreciated.

The situation:

• Asking price: £120k
• Our opening offer: £108k
• This was rejected, the estate agent indicated £115k was likely to be accepted

The EA works for them.

Your offer is already 8k more than the previous offers.

hcb42

I definitely wouldnt use their sols either - but that quote looks awfully high to me...about double what I just paid in fees etc

suze012

Do you think £115 is a fair price for the property? I don't know the house etc but I know if someone said this is their price they would accept, I would defo offer less than that. Not drastically under, Perhaps £1,500 - £3000 less.


I just sold mine and advised our sellers that our bottom price was ... and then expected them to meet us half way (which wasn't a lot about £1500) and they accepted our bottom price so was more than happy with it! But their offer wasn't as low as your starting offer.

makeyourdaddyproud

I think your offer was fair; let the EA sit and wait for your revised offer which won't be forthcoming.

The EA is playing you with their cliche response.

If they call for a revised offer then return a cliche response thus "I can't go higher because I'm at my max budget. I will have to look elsewhere..."

£115k out of £120k if, and only if the area is in red hot demand.

makeyourdaddyproud

An offer is an offer, no matter what the figures portray.

10% below asking sounds a good starting post. If the EA wants to to start throwing eggs out of the basket it's the EA's problem, not the buyer's.

£108k and see what happens.

suze012

But his £108,000 has been rejected? Don't quite understand, do you expect them to contact the buyer back and say actually we have changed our minds? I know after saying no to a recent offer on my house that I wouldn't change my mind. But everyone is different.


Take it there is no one else interested at the moment? Really depends how quick they want to sell and 2 months on the market isn't that long, around where we are 12 months is the average!

faeryty

Thanks everyone for all the replies. Certainly lots to think about and after thinking about it for a while we'll definately not going to just roll over and offer 115. Now just have to work out a figure.

Want to let them sweat for a bit, but no, as far as we know there isn't any one else bidding at the moment (and I assume an estate agent would jump at the chance to tell us that). However, the property is in a good area for access to the local university and so the vendor considering putting it up for rent instead of sale if it doesn't sell quickly would make sense (and is also positive for resale potential when we eventually move on.

A couple of people are saying don't use the EA's conveyancer. My gut agrees, but my head can't really work out why (beyond price, but if we could essentially getting it for £300 or so because of the scheme the EA offers, which does seem like a good price). Is it about the potential conflict of interest? And/or anything else? (hcb42 - if you had a good experience with your conveyancer, I'd love for you to PM me their details)

makeyourdaddyproud

Suze012 wrote: »

But his £108,000 has been rejected? Don't quite understand, do you expect them to contact the buyer back and say actually we have changed our minds? I know after saying no to a recent offer on my house that I wouldn't change my mind. But everyone is different.


Take it there is no one else interested at the moment? Really depends how quick they want to sell and 2 months on the market isn't that long, around where we are 12 months is the average!

That's the whole point.

1st offers are nearly always rejected. In fact, if my first offer was accepted then I know I've played my game badly.

The buyer has lost nothing if you don't accept. But like you say, it depends on the seller's circumstances. The real agony begins for the seller if no further offers are forthcOming.

MysteryMe

Not really as the seller is apparently happy to rent the house out.