Help! What offer to make Woolwich House

ssoussan

Hello all.

First of all, thank you for those who will take the time to read my post and reply.

My husband and I have found a Terraced 4 bedroom house in Woolwich, freehold(10 min walk from Woolwich Arsenal) and are ready to make our offer, thing is:

We have done our research in terms of how much the property was bought at, 5 years ago, and how much the properties in the same area (1 mile away ish) are valued now. The property was bought as a new built in june 2014 at £324,995 and the asking price is £580,000.

It is in good shape, and built correctly.

However, we are having a hard time seeing the increase in value of over 50% in less than 5 years considering the average market price in the area and also, the house in itself (no work has been added/done .. it is being resold as it was bought).

We are thinking in making a low offer and see where it takes us. Offer we make would be £535,000.

Any advice on this offer figure, or other advice on the thought process?

Thanks in advance!

Comms69

Impossible to say to be honest. Looks like they aren't in a rush to sell and are starting high.


Ultimately they could turn around and say actually it's £630k now. Offer what you're happy to pay

need_an_answer

Quite honestly you can come up with as many reasons to offer a certain amount based on whatever you choose to base that figure on.

The key is getting to a point where yourselves and the vendor are thinking of the same figure.

Until that happens theres no deal.

Make your offer if that's what you feel the property is worth,the vendor has 2 choices accept or reject.

One point to note though is would you go to the asking price or how close would you go?
If you are thinking of putting in several offers or even just 2 you need to make the next offer if this one is rejected your strongest offer. After about the 2nd offer that the vendor rejects you tend to find that you may not be viewed as a committed buyer.

hazyjo

What were similar properties selling for 5 years ago? They probably would have paid a bit of a premium for a new build. A mile is too far in Woolwich, that would hit Plumstead too, you need to look nearer to the development, and preferably similar styled houses.


If it's a townhouse, remember they can be slightly harder to sell.


I bought in E4 for £274k in 2013. Sold in 2017 for £515k. If someone had told me they didn't think I should be making nearly double, I'd have laughed them out the door and told them to go buy something cheaper... Prices did increase at that rate in parts of London. My price wasn't ambitious. It hardly rose at all the last year, so actually it was within 3 years. If it had continued as it had the 3 years before, it would have actually been more like £600k.


How long has it been on the market? Has the price been dropped yet?

ssoussan

Thank you everyone.
The house has been in the market since Dec 19th, 2019 and no, the price hasn't dropped.
Similar houses, close by (1/4 and 1/2 mile) are near £550k/£580k ...

I guess if I am willing to settle at £550 .. would £535k be a good starting point, or would the seller automatically reject without willing to negotiate?

What would be an acceptable starting point?

jonboy321

I do hate Zoopla and Rightmove for this reason. You negotiate on what the house is worth now and what comparable properties now go for. I find it impossibly cheeky when people look back and go "you have made enough money".
1 month isn't a long amount of time, and they might have had other offers. Offer what you think it is worth, not what you think they should have made.

AdrianC

ssoussan wrote: »

We have done our research in terms of how much the property was bought at, 5 years ago, and how much the properties in the same area (1 mile away ish) are valued now. The property was bought as a new built in june 2014 at £324,995 and the asking price is £580,000.
...
However, we are having a hard time seeing the increase in value of over 50% in less than 5 years considering the average market price in the area

Forget what it was sold for five years ago. You weren't buying it then. It's less relevant than thinking about what the sale price would have been in 1991, because at least that's used for council tax banding...

As for what the vendor's reaction will be to any given offer, there's only one person can answer that - the vendor...

It's fairly obvious from RM which one you're talking about. It's been on the market less than a month, including the Xmas and NY hiatuses, so an offer of ~10% below asking is not likely to be warmly received, at a guess.

The relevant comparison is with what's on the market NOW. And there isn't actually that much. There's some rather nice period stuff on Shooters' Hill, but that's a chunk further to Woolwich {Edited by Forum Team} station (sorry, memories of student years...) and there's a rather dingy 90s "townhouse" on the other side of the river. Or there's a newbuild right on the station. Given the location and presentation of this one, I don't think it "feels" overpriced, compared to those.

sal_III

ssoussan wrote: »

Thank you everyone.
The house has been in the market since Dec 19th, 2019 and no, the price hasn't dropped.
Similar houses, close by (1/4 and 1/2 mile) are near £550k/£580k ...

I guess if I am willing to settle at £550 .. would £535k be a good starting point, or would the seller automatically reject without willing to negotiate?

What would be an acceptable starting point?

So if similar properties nearby are selling for £550k-580k, what makes you believe £580k is overpriced for this one? How much the current owner paid for it is completely irrelevant.

It's has been on the market for less than 1 month during the holidays nonetheless, I highly doubt the vendor will entertain an offer of £535k at this stage

hazyjo

ssoussan wrote: »

Thank you everyone.
The house has been in the market since Dec 19th, 2019 and no, the price hasn't dropped.
Similar houses, close by (1/4 and 1/2 mile) are near £550k/£580k ...

I guess if I am willing to settle at £550 .. would £535k be a good starting point, or would the seller automatically reject without willing to negotiate?

What would be an acceptable starting point?

Depends on their position too. Have they got somewhere to go? Are they still looking? If the latter, they ain't going to accept a drop of £45k. Don't forget that was just before Christmas when most EAs and solicitors were closed for a couple of weeks. In fact, I would actually say it's prob been on the market 2 weeks in that case.

jonboy321 wrote: »

I do hate Zoopla and Rightmove for this reason. You negotiate on what the house is worth now and what comparable properties now go for. I find it impossibly cheeky when people look back and go "you have made enough money".

Totally agree. Five years is IMPOSSIBLE to compare against! I was trying to say if it was selling for similar prices to other properties at that time, it should be worth what similar properties are worth now. I doubt very much it's that overpriced now from what AdrianC says. I used to live in Eltham so knew Woolwich too and saw many changes over the years. I presume it's changed/improved even more to be asking prices like that now! I expect the Elizabeth Line has added a lot of that.

bouicca21

I was in the market to buy in 2014 and can tell you that prices in SE London were rocketing - increases of 30+%. It wouldn't surprise me at all if Woolwich went the same way. There are some very nice bits (and some thoroughly nasty bits) plus there is the Arsenal effect and the new Elizabeth line.

The problem you have is that there will be very few comparable because the housing stock there is generally very old. You have picked one of the nicer bits but I hope you know just how much traffic passes near your proposed purchase. Not an area I'd wish to be in during the rush hour.

You'll get better value up on Shooters Hill slopes, or Kenilworth gardens - but then you wouldn't have shops and a station nearby and I think the houses are smaller.