Bidding Wars

clarky_cat

Hi,

I'm in the process of looking for a new house in the Manchester area but finding that houses in the most desirable yet affordable areas are going within days. We are off to view one today which went on the market on Monday. It looks perfect for what I'm looking for but the EA advised 25 viewings have already been booked. Is this normal and do properties with so many viewing often go for more than asking price? Or do you think the EA is trying to bump up the price by telling people the number of viewings? If we really like I'd be tempted to offer the asking price.

djt1

Having recently purchased a property in Manchester, I can confirm (based on my own experience) that properties in the more desirable areas go very quickly, often within a day or two.

With the place we purchased, we were the first to view on a friday, the second group to view put in an offer of the asking price and by monday the vendor had received several offers. In the end, we offered over the asking price as it was the best place we had seen for our needs by far.

All I can suggest is don't bother trying to play games if you find the right property, make your best and final offer (based on what you would be prepared to pay) and emphasise your position (DIP, deposit %, quick move.....).

All the above said, I have noticed things have slowed down a bit over the last couple of months, not sure if that is just time of year, or the market itself, but things are definitely hanging around longer than they were.

Where in particular are you looking?

clarky_cat

Thanks, useful info. If you don't mind me asking, what % over the asking price did you go?

The one we are looking at today is in Prestwich, very close to the metrolink and not far from M60. We've also been looking at Urmston, Flixton, Monton, Swinton and Worsely. Iv'e seen very little in South Manchester for our budget (£200k or less)

HouseBuyer77

I'm buying in an area with a similar market (anything vaguely decent goes in days). In my experience it is possible to get such properties around or at the asking price but it's very much luck of the draw.

It depends upon the sellers and who else is putting an offer in. For a couple of specific examples I had an asking price offer accepted on a property that had had a lot of interest, though this eventually fell through for other reasons. My current (in progress) purchase I ended up above asking price but not significantly (4% ish). There were several who offered on that one and I wasn't the highest bidder (there was a far higher offer on). However the sellers were keen to get moving and I was in a position to proceed quickly, the higher offer involved a chain (I'm FTB) so they went for me.

Other properties that I haven't put an offer on but have had sufficient interest in that agents have been keeping me updated seem to be going for asking or slightly above.

The key thing is not to get too caught up in the madness. Accept that if you want something you may well have to go above asking. So when you're first looking at a place decide where you might go above the price and stick to that. Start with an asking price offer, then when multiple offers go in you should get a chance to put in a best and final offer. Then you can give your real price.

You can just go best and final as first offer but I've found that with multiple offers on the table agents will tell others about them. They won't reveal specific numbers but they'll give you some vague clues (e.g. got an asking price offer from a cash buyer and one a bit above from an FTB). So if you go in with your actual top price to start you could end up getting outbid more easily. Of course there's also the risk the vendors won't ask for best and final offers and just go for the first offer they see that suits them.

Another point to add is it can be worth giving a good impression to the agent. Ultimately if the vendors have multiple close offers to choose between they may well choose based upon the agent's impression of the buyer. Whilst I don't have any direct evidence for this I believe that I got the property I did in part because I'd given the agent the impression that whilst I was an FTB I had a good understanding of the process and had everything in order and ready to go so a more solid buyer than others that were on the table.

Gadge2011

Good properties are always going to have a high interest, if you like it then you'd hope other people would too.. just judge the house based on how you see it.

The estate agent will usually collect bids, pass them onto the vendor and then you'll most likely be asked if that your final offer before the winning bidder is offered it...It seems some people just bid for the hell of it, even when they cannot afford it or in a position to purchase, or I suspect they are hoping something bad comes back on the survey to renegotiate the higher price they offered.

On the house we are buying we lost out at first since every viewer of the house placed a bid (5 or 6 bids) all of which were fairly close to the asking price.

The vendors choose someone else who had a house for sale, 3 weeks later they were not closer to selling the house so we were offered it. We mentioned to the estate agent to keep in contact should the sale fall through to contact us.

HouseBuyer77

On the house we are buying we lost out at first since every viewer of the house placed a bid (5 or 6 bids) all of which were fairly close to the asking price.

Also a very good point. In such a market people will be keen to place offers just to get a stake in the game even if they haven't worked out the details yet.

Some friends of mine got outbid on a house by a cash buyer. A few weeks later it transpired the cash buyer was only a cash buyer once their divorce had been finalised. My friends got the house instead.

I've also seen a fair number of decent properties reappear on the market a few weeks after they got sold STC, presumably for similar reasons.

So the more evidence you have to provide to an agent that you're serious the better chance you'll have of getting your offer accepted.

Though do beware of the seller as well. With so many buyers around they may take you for granted and not worry about making you wait (if you pull out someone else will be along within days). So try and determine their plans with the agent.

djt1

We ended up offering 1K/0.3% over asking/guide price. I don't know if that was the best financial offer in the end, but I'm inclined to believe not. That was what we were prepared to pay, taking a pragmatic view that we would be there for several years.

When we made the offer, we stressed our position, DIP, deposit %, solicitor ready to instruct and flexible in terms of completion moving from rented.

My view is that in Manchester, good properties, in good locations are likely to get more than one offer. Chances are someone will offer the asking price, if not very close, hence I don't think you can try going in low, hoping to meet somewhere in the middle. Why would the vendor waste time negotiating with you, when they already have a better offer on the table?

Good luck!

clarky_cat

Thanks all. We went to view the property yesterday and thought it was great so have put in a offer at asking price. The EA said they've received a number of other offers as I thought they would. They are going to call everyone on Saturday to ask for their final offers. I don't plan on going too much over the asking price but still deciding on what our final offer will be.

We are not in a chain and have our deposit already in place. I'm speaking to the mortgage broker today to get a mortgage in principle sorted. I've already checked how much we can borrow with the main banks and, based on what we both earn, we can borrow significantly more than the mortgage we'd require for this property. Is there anything else anyone can think of that would increase our chances?

Gadge2011

clarky_cat wrote: »

Thanks all. We went to view the property yesterday and thought it was great so have put in a offer at asking price. The EA said they've received a number of other offers as I thought they would. They are going to call everyone on Saturday to ask for their final offers. I don't plan on going too much over the asking price but still deciding on what our final offer will be.

We are not in a chain and have our deposit already in place. I'm speaking to the mortgage broker today to get a mortgage in principle sorted. I've already checked how much we can borrow with the main banks and, based on what we both earn, we can borrow significantly more than the mortgage we'd require for this property. Is there anything else anyone can think of that would increase our chances?

Just depends on what the seller want's, they might want money, they might want to move quickly, they might have liked that X viewer drove a specific type of car...It really just depends.

if you don't get offered and you are still interested then just ask the estate agent to keep in contact, many people get over excited and cannot afford what they are intending to buy so you just never know.

Like I said previously, we were in an entirely better position then the other person they originally offered the house since we had a mortgage broker ready that had already done the cost assessment stuff, and a solicitor we knew we were going to use. I can only assume the other person offered an amount that couldn't be refused.

We are now even ahead in the process of the people we are buying from which is pretty annoying since they had agreed to buy their house a good 5 weeks ahead of offering us this one, I suppose that is just how the game goes unfortunately.