Negotiating for a flat in this turbulent market

happinessfactory

1) Use ourproperty.co.uk to find out what the most expensive comparable property in the postcode and neighbouring postcodes has ever sold for. This should be your ceiling price - April / May was the top of the market in East London and these are being listed as August sales on the site.

2) If the recent sales you've spotted in ourproperty were in the last 3 months or so, you may still be able to check out the floorplan on the local estate agents' websites as they often pad them out to give the impression of being busier than they are. Divide the square footage by the price actually achieved, and then offer 15% less per square foot as your opening offer.

3) Make your opening offer in writing, so that you can include your ourproperty comparables and your other selling points eg deposit and mortgage arrangements. The agent can simply fax this over to the vendor and the comparables should prepare the vendor for serious negotiation.

ETA these tactics do not work in West London where the market is still inexplicably climbing, seethe.

Jason74

SquatNow wrote: »

Go around offering 50% on a lot of different flats. One of them will take your offer.

Nothing is selling. Estate Agents are bricking it. While people may talk it up on here, in reality estate agents are desperate to sell something. Anything. At any price. zero sales means zero commision.

Personally if you can, I'de rent for a few months/years to see how bad the market gets. Just enjoy the view happy that your not in negative equity.

Or better still, try squatting sociably for a few years. The money you will be able to save up will mean you will be able to buy a house outright after the crash.

To be honest, things are nowhere near as bad as that in London at this stage (although I grant you that may change). Things are slowing visibly, and there is some loose auction evidence that we could be at the start of a major change in the market, nothing of note has actually happened yet as far as I can see (in London at least)

The OP may wish to consider whether buying at this stage (esp FTB) is right for them at this tricky time in the market, but it is a gamble to buy OR not to buy imho, and it comes down largely to what risks an individual is more comfortable with.

As for the idea of where to come in offer wise, I agree that 165k (or 160k if REALLY cheeky) might be a good place to start if the OP is serious about this property. This is probably a time to be trying to drive a hard bargain, but much less than that probably won't be taken seriously, even in this market

Jason74

master_ian wrote: »

Thanks for the posts everyone...A bit more info on the flat: It's been on the market for 6 weeks and according to the estate agents ASTON FOX, can generate monthly rent of £850. Here's the property: http://www.rightmove.co.uk/viewdetails-15637429.rsp?pa_n=2&tr_t=buyOther 2 beds in the area are prioced at £170K - £210K depending on location and condition. It may take a few months before vendors accept they may have to lower their asking prices.No worries, I won't be coming in at less 50%. The consensus so far seems to be 10% - 20% below asking price. 2 East London EA's thought 10% below was too much to start with!

Good rule of thumb. If an EA doesn't think you're opening offer is significantly too low, it is too high

Kez100

poppy10 wrote: »

So he paid 62.5% of the original asking price, which is a saving of 37.5% off the the original asking price. :money:

Thanks.

To the person before who is no expert on percentages, the question was how much to offer. We offered 62.5% of the asking price.

master_ian

Thanks for the helpful replies happinessfactory, Jason + co...that ourproperty website is good for comparables. We will be viewing all afternoon Friday so looking forward to some new properties. BTW, I am FTB BTL...

IveSeenTheLight

SquatNow wrote: »

Nothing is selling. Estate Agents are bricking it.

I'm not sure where you are talking about.
In my street, any houses that go up for sale are under offer within a week or two. this is till the case as one sold just two weeks ago.

SquatNow wrote: »

Personally if you can, I'de rent for a few months/years to see how bad the market gets. Just enjoy the view happy that your not in negative equity.

I have two properties, one has risen 88% in the last three years, the other has risen 33% in the last year.
I'm fortunate that my area is seeing a record rise.
Will house prices drop? I dont think so, maybe more stagnate, but will they drop below what the price the houses have already risen by and by any additional equity I already have by paying back the capital of my mortgage, I dont think so

SquatNow wrote: »

Or better still, try squatting sociably for a few years. The money you will be able to save up will mean you will be able to buy a house outright after the crash.

:rotfl: :rotfl: :rotfl: :rotfl: :rotfl:
Good luck with that one

IveSeenTheLight

Badger_Lady wrote: »

You are right - asking prices are nearly always higher than expected sale prices, so the OP should bid lower. And you're also right, 50% is OTT to put it mildly.

Its a different system in Scotland.
The EA's now put places on the market well below the valuation.
this drives up viewers and potential bidders thus increasing the price.
In this system, you bid what you are willing to pay at a closed envelope auction. If you are the highest, you win, with no oppertunity of guzzumption
I've seen a property marketed at offers over 110,000, be valued at 145,000 and go for 165,000.

I'm personally glad the system is not the same as in England as there seems to be so much ambiguity around down south