Offer price v asking price - what's realistic these days?

PeteW

We went and looked around a house today and are thinking of making an offer.

Just wondered what a realistic offer price is in relation to the asking price?

When we bought our current house in 2008, the market was very different and we managed to get almost 10% off the asking price - does anyone have any more recent experience of what's achievable in the current market? Or does everything go for asking price?

Cheers

Pete

Landofwood

No such thing.

You should offer what the house is worth to you.

ellie27

PeteW wrote: »

Just wondered what a realistic offer price is in relation to the asking price?
Or does everything go for asking price?

Pete

It depends if the house is priced correctly. The house we are buying was not priced correctly and had been up for sale for almost a year and 2 price drops then we zoomed in!

Asking price is just that, what the seller is asking you to pay for it.

If there is demand for the house it could go way over the asking price, if there is no demand for it the sellers could want out soon so happily accept less than asking.

The sellers might not financially be able to accept 10% below asking.

You offer what the house is worth to you. How much do you want it?

PeteW

Landofwood wrote: »

No such thing.

You should offer what the house is worth to you.

Well… I'd agree on most things, but with a house, they are so insanely overpriced and the figures involved are so incomprehensibly large that that logic doesn't really work.

What I think a house is worth is sadly irrelevant because nobody will sell one to me for that! So the best alternative to that is understanding the market to pay as little as possible for a property we want - even if I don't think it (or any house) is worth the money!

Landofwood

PeteW wrote: »

Well… I'd agree on most things, but with a house, they are so insanely overpriced and the figures involved are so incomprehensibly large that that logic doesn't really work.

What I think a house is worth is sadly irrelevant because nobody will sell one to me for that! So the best alternative to that is understanding the market to pay as little as possible for a property we want - even if I don't think it (or any house) is worth the money!

If you're willing to pay a bit more to secure the house, then that's how much the house is worth to you. That's what I said!

SplanK

Vastly varies...

We accepted an offer 5k below asking price on our current house...


We offered and had accepted an offer on our onward house at asking price... because it was worth what they were asking and for us, it was THE house we want to move to. We did try asking for 6k under, but we went for another viewing, and thought sod it, its the one and went for it.


So many variables.

Hoploz

Every case is different as it depends on the buyer and the seller's circumstances. How keen to sell, whether they have found something to move to, whether they have just had a deal fall through, or just testing the market considering a move.

Pollygarter

I'm moving currently, least hoping to. There seem to be two trends in the south east. The desirable properties (location, layout, state of repair) go almost immediately for at or above asking price. The rest languishes and gets its price reduced several times. Probably the same all over.

Landofwood

There's far too much consideration of asking price going on in this thread.

Firstly, the people who set the asking prices are not qualified to set accurate prices. By all means they can say that this is what they want, but it doesn't mean that's what they'll get.

Secondly, asking prices are used as a marketing tool:

- Sometimes asking prices are purposely set low to drive activity and create a bidding war

- Sometimes asking prices are set accurately

- Sometimes asking prices are purposely set too high to give an impression of prestige in the area, but the owner will accept an offer below.

If you're working on the basis of offering x% below asking price, you are gonna have a hard time.

Figure out what you'd be willing to pay to secure the house and offer that amount. That's what the house is worth to you.

FWIW, I ended up recently paying 590 for a house that was listed at 575. I did my research and my opening offer was 580 - this was not the highest offer, someone else had also figured out that the asking price was too low. There were 7 other offers at asking price and they were all discarded.

Digsby

I don't have recent experience of offer prices vs asking prices, but I do have recent research. It differs greatly from area to area and month to month, because as Landofwood rightly points out, every property is different, every seller is different, every valuer is different, and every market is different, at every point in time.

But having said that, my research shows that sold prices are on average about 4% below asking prices (this is by comparing actual sold prices to each respective property's actual asking price).

30% below happens, and 30% above happens, so 10% off is definitely achievable depending on the circumstances, but 4% below the asking price at which a property starts attracting offers is roughly the amount that a given property is statistically most likely to sell for at the moment.

It's debatable how relevant the research is to anybody's negotiations, but I thought it worthwhile enough to at least have an idea. If I'd found that the average was 20%, then that would be a different matter.

ReadingTim

Fifty percent and a night with the vendor's wife.

Anything less is just insulting.