Buying House Cash Buyer - Advice

DeafGoose

Hi fellow members,

Im in need of some advice when dealing with a house purchase. I am a first time buyer and have cash ready to purchase our first family home.

I have done some research when it comes to making offers and since it will be my first time I want to get some input from the community

I am looking for properties within a 5-7 mile radius from Littlehampton, for a 4 bed detached or end of terrace. I have seen many on rightmove with asking prices between 280K - up to 325K.

Being a cash buyer, I am expecting things to be easier when it comes to negotiating, but my question is, making initial offers of 5%-10% based on these asking prices would be “offending”? I have heard that most asking prices are inflated by these percentages, looking for some feedback here if I am being realistic here.

Being a cash buyer, what can I work to my advantage?

My set budget is 270-275K

Thanks already for all the feedback!

TranceNRG

You are very luck to have that much in cash.
I'm a new first time buyer currently have a flat under offer but before that I'd seen about 30 flats and made offers on about 4 properties. 2 were accepted.

As you say the prices are usually inflated becasue estate agents/sellers know the buyers will usually offer less than the asking price initially. It's a bit of a game. Well that was my experience anyway.

I would say there's absolutely nothing wrong with offering 5-10% less if it needs a bit of work doing. However the final price will depend on how much demand there is for the property. If there's a lot of interest you are unlikely to get it that much cheaper than the asking price.

But won't hurt making a lower offer as you are in a great position being a cash buyer. If you don't get it, don't be disheartened. An even great property is just around the corner.

Good luck.

ognum

Sometimes cash buyers can get an advantage, sometimes they don't.

The thing I dislike when selling to cash buyers is they have no great commitment to the property, they are not tied to a mortgage which is tied to the one property they have had surveyed and the mortgage agreed on. I myself as a cash buyer have ditched a couple of purchases when if I had a mortgage I may have stuck with them.

I live in an area where very other buyer is a cash buyer so they are not considered special in any way.

My favourite buyer is someone with a large amount of cash who also requires a small mortgage.

Whatever your circumstance decide what the property is worth to you and offer that amount.

ognum

With a budget of 275K most sellers would accept a mortgaged offer of 275k over a cash offer of 10% less at less than 250k!

MobileSaver

DeafGoose wrote: »

Being a cash buyer, what can I work to my advantage?

Most sellers do not care whether it is your cash or the bank's cash and so your advantage is slight at best.

ognum wrote: »

With a budget of 275K most sellers would accept a mortgaged offer of 275k over a cash offer of 10% less at less than 250k!

Ognum has hit the nail on the head; most sellers would prefer to wait a few more weeks for a buyer's mortgage to be approved rather than accept thousands of pounds less for a "quick sale."

In my view and experience you are unlikely to get a better deal than a mortgage-buyer but you could be more attractive if you and a mortgage-buyer offer the same amount for a property.

Davesnave

DeafGoose wrote: »

Being a cash buyer, what can I work to my advantage?

If you are a real cash buyer, not just someone with nothing to sell and still needing a mortgage, then you can take advantage of situations where a mortgage might be tricky, either because of the condition of the house, or something else.

Or, like me, you might just find a seller who needs to move very quickly.

You'd also have a freer hand at auctions.

moneyistooshorttomention

On the other hand - with £325,000 in cash literally sitting there in your bank account (because that is what is meant by "cash buyer") then you could take a leap up the ladder right away by using that £325,000 as a deposit and taking out a mortgage as well and buying a dearer house.

Not knowing how dear the area you live is, as that amount of money would buy some of the Forever Home level houses in my home area (ie I'd need a maximum mortgage of £45,000 to be able to buy any Forever Home I chose there the last time I looked, based on a deposit that size) or any Forever Home level home in my current area.

Bart1

I'm in a simalar position, or at least will be once my late Dads place is sold. My tactics is not to fall in love with one particular place but make silly low offers on lots of places.

As someone on here said before, if they ain't insulted by your first offer, it was too high.

ognum

Bart1 wrote: »

I'm in a simalar position, or at least will be once my late Dads place is sold. My tactics is not to fall in love with one particular place but make silly low offers on lots of places.

As someone on here said before, if they ain't insulted by your first offer, it was too high.

That will certainly work in some areas ( the less desirable ones) and on some houses (the less desirable ones) if that is what you aspire to them it's a great strategy.

Bart1

:money:

ognum wrote: »

That will certainly work in some areas ( the less desirable ones) and on some houses (the less desirable ones) if that is what you aspire to them it's a great strategy.

Dunno about aspire but I'm governed by my budget of 80G which will get me a 2/3 bed terrace in Lowestoft which is desirable to me.

ognum

Bart1 wrote: »

:money:

Dunno about aspire but I'm governed by my budget of 80G which will get me a 2/3 bed terrace in Lowestoft which is desirable to me.

Always good to live within your budget but for me location is always key, buy the worst house in the best location you can improve the house but you can't to anything about the location!