Single & First Time Buyer: offer rejected

SnowDrop

Hello Everyone,

I am a single FTB with zero experience in the property market so any advice would be appreciated.

I would like to buy a studio or a small one bedroom flat, have saved up enough for 10 percent deposit & costs, and my bank is ready to lend me a mortgage.

A few days ago I saw a property I liked. The vendor wants £160,000 for it. Before I went to see the flat I did an online search and found out the current owner bought the property for £125,000 in 2015, i.e. less than two years ago.

Now maybe it was not the best idea to check these records, but after seeing the property, although I did really like it, my gut feeling was telling me it was overpriced. I also found out that the leasehold has not been renewed by the current owner and has 70 years remaining.

The EA put some pressure on me immediately to make an offer, and called me the next day to say hurry as offers started coming in already. So I jumped in, but decided to go low and offered 16% less than asking price. The EA said this was insulting and she guarantees it will be rejected unless I offer more (I didn`t). The next day the letter came through saying my offer has indeed been rejected. As all this happened very quickly , to be honest I am not even sure she actually forwarded my offer.

Anyway, there is no counteroffer and the EA is not telling me how much the other interested parties have offered, only `very near the asking price`. I am considering going in with another offer now but still it would be 8-9% below the asking price.

I guess my question is how to proceed? Should I move forward in small steps or make my final offer? How likely is it that the EA is playing me and making up the story of other offers? She emailed me to say another offer has been accepted by the vendor - is this a standard reply that comes back to buyer with a rejected offer?

Any input is appreciated. Thanks. :beer:

Guest101

I'd reply saying:


Thanks for letting me know another offer has been accepted. I'll get in touch about future viewings.

hazyjo

Irrelevant what they paid 2 years ago. My house has doubled in four years. Some areas have shot up more than others.


You probably wouldn't get a mortgage on it with 70 years remaining.


-16% is a very low offer.


If she says there's an accepted offer, then there's an accepted offer. It's not a usual tactic for you to then get into a bidding war without them inviting it.


In future, compare against SOLD prices of similar nearby properties. Offer what you think it's worth. Don't just offer low for the sake of saying you have a bargain. It might still be priced high - you need to do your own research. And go back once or twice (three at an absolute push), don't keep going up and up or any EA will just keep coming back. You need to say STOP at some point.


It's unlikely an EA will tell you what other offers are.


Jx

AFF8879

Where is this property located? The lease length would scare me. To be honest, unless its majorly discounted (which doesn't sound to be the case) the seller is going to struggle to offload it. If it were me (though I wouldn't touch a property with a lease that short unless it was going to be extended as part of the sale), I'd leave my initial offer on the table for them but then walk away.

tim123456789

hazyjo wrote: »

Irrelevant what they paid 2 years ago. My house has doubled in four years. Some areas have shot up more than others.


You probably wouldn't get a mortgage on it with 70 years remaining.


-16% is a very low offer.

My sister went in at -23%

and even that is more than the flat is worth

6 months later, the property is still on at its over inflated price

and it's a "must sell" oldie person moved into care (or died, I forget) property, not just some chancer who will sell if they find the idiot prepared to over pay.

ukcarper

Prices of flats in my area have gone up about 15% to 20% since 2015, but the 70 year lease would put me off. How does the price compare to similar properties.

SnowDrop

Thanks for the replies. I did check sold prices of similar properties in the area (same building, street and postcode) and could not find a single studio apartment of similar size that went for over £150,000. Bigger, one bedroom apartments yes, but not studios, actually another nearby studio I viewed was priced £140,000 and in similar condition. And I based my offer of -16% on the fact that I would have to extend the lease within a few years. Not scared of the lease length per se, but do think seller should either extend it or lower the price of the property.
Once again thanks for replies, I am not familiar with the protocol and bidding procedures.

[Deleted User]

As a tip - don't take it personally. People are HORRIBLE when it comes to house buying.

Estate agents are there to sell the house for the owner - they'll work in their interests - not yours.

Don't wimp out and offer more. There are no rules. People play games - I held our sellers 'hostage' until they offered £2k more to cover my estage agent fees! That was after I did a background check on them to see their financial interests.. (turns out they still sold it for £100k more than they paid about 4 years afterwards so I don't feel bad)

eddddy

You need to remember the dynamics of the situation.

The EA just wants the flat sold - she won't be too bothered whether it sells at £140k or £160k.

The vendor will be very bothered about whether the flat sells at £140k or £150k or £160k.

The EA is trying to get you to offer an amount that the vendor will accept. Some EAs will bully buyers and lie to buyers to achieve this.


So don't take too much notice of the EA, and just offer what you are comfortable with. Whilst bullying you to increase your offer, the EA will also be bullying the seller to accept it.

kinger101

How much longer would you need to save for the deposit on a 2 bed? 1 beds and studios can be nearly impossible to shift in a slow market.

The EA cannot tell you what other people have offered, but if you think it's overpriced, walk away.

Marvel1

Bought mine 9/10 years, it's most likely the same price, ah well.