How long to leave between offers

ilikecookies

As others have said it really isn't a game and viewing it in this way just sets you on a pitched battle against the seller. Ultimately both parties have to meet at an acceptable figure.

I really doubt the majority of "tactics" often discussed here actually work - eg. trying to convince a seller that their price is wrong (which seems to be coming up a lot on here), going in more than 10% under and raising the offer slowly etc, thinking that because a house has been on the market for a "long time" then a huge discount is reasonable, etc. The buyer might be right that it is overpriced but is a seller really likely to agree? It's hard to budge a price when they have been told it's "worth" x amount, the selling price could be the minimum they require for whatever reason etc.

My view as a previous buyer and future seller is you have two bites at the apple. A first offer and a second offer. You should be prepared for the first to be turned down and should be prepared to walk away if the second offer is declined. A couple of days between making the two offers to show you have thought about it seems sensible to me.

The difference between the two offers is the tricky bit. If you first offer is way off the mark and your second is a lot higher the seller will probably dig their heels in. If the difference is small then was it worth the risk losing the property?

Just offer what it is worth to you. If this is rejected then continue your househunt as there are plenty more.

Thrugelmir

J_i_m wrote: »

I've made the first offer. It was a bit of a punt at approximately 15% under asking price which has unsurprisingly been declined. Although if my research has been accurate then I actually feel it was a fairly generous opening offer.

Sounds as if you and the vendor are a long way apart on agreeing a price. Might as well carry on house hunting and monitor this particular property for a price reduction.

Humandoing

I don't understand what the need is to haggle over a price (& risk losing a house you love) when often it is only a matter of a few grand. I know it's not nothing but surely spreading that cost over the course of your mortgage in terms of monthly repayments, it barely makes a difference?

Radiantsoul

Humandoing wrote: »

I don't understand what the need is to haggle over a price (& risk losing a house you love) when often it is only a matter of a few grand. I know it's not nothing but surely spreading that cost over the course of your mortgage in terms of monthly repayments, it barely makes a difference?

A few grand is a lot of money to many people though.

J_i_m

Humandoing wrote: »

I don't understand what the need is to haggle over a price (& risk losing a house you love) when often it is only a matter of a few grand. I know it's not nothing but surely spreading that cost over the course of your mortgage in terms of monthly repayments, it barely makes a difference?

It's not simply about spreading a few extra thousand across the term of the mortgage though is it?

It could potentially affect the deposit to loan ratio and therefore the repayment interest.

And then you have to consider if the lender will actually lend you that extra few thousand.

I think there are many factors to consider, it's not haggling as such more negotiating.

I haven't put forward a revised offer yet, but I will do so tomorrow as my best and final offer. If they the decline it then I will not increase any further but will leave it on the table should they wish to revisit it at a later stage.

Humandoing

Good luck!

JimmyTheWig

J_i_m wrote: »

It could potentially affect the deposit to loan ratio and therefore the repayment interest.

Very unlikely. Unless the valuation comes in below, the value used will be the purchase price.
So £25k deposit on a £250k purchase gives you (250-25)/250 = 90.0% LTV.
Get £2k knocked off the price and it becomes (248-25)/248 = 89.9% LTV
Makes very little difference.

And then you have to consider if the lender will actually lend you that extra few thousand.

This, on the other hand, is a deal breaker.
If you get within £2k of asking price and it is the highest you can go and they reject, I'd be tempted to demonstrate with your figures how it is the highest that you can go. Let them know that you can't possibly go any higher, whatever games they play. Then it's up to them if your offer is actually acceptable or not.

J_i_m

I've made my second and final offer now.

I thought it over yesterday and decided to go straight up to the maximum that I'm prepared to pay for this property. Another offer inbetween would have been silly.

I haven't heard back yet, but am comfortable with either outcome. If they accept then I am ready to proceed. If not, then my offer remains on the table and I'll look for alternatives.

dinkylink

let us know how it goes, fingers crossed!

J_i_m

It's been turned down as well, with a counter offer asking for £7k more.

I stuck to my plan of 'best and final offer' and left it on the table.

I did my research (yes I know you have to be careful on this) and found two flats, both of the same spec and same group of buildings which had been refurbished and sold for £25k within the past two years. The average price increase in my area has been around 4% for the past 2 years.

This flat has not been refurbished and both the kitchen and bathroom are in need of some tender care. Both of my offers went in above 10% above those sold prices of the neighbouring flats.

I am therefore satisfied that my offers were both fair and I suspect relatively competitive too. At any rate it's been on the market for at least 3 months now, possibly longer.

But not to worry, this was the first place I've offered on so its all useful experience.

I suspect the market will be a bit quiet for the next few months now, so I'll concentrate on saving more money whilst keeping an eye on rightmove.