Negotiations for second offer on house (FTBs)

steampowered

I don't think offering £222.5k is credible. That's a micro negotiation, and will encourage the seller to come back with another counter-offer to edge you upwards.

Once you are in a micro negotiation, nobody will believe you when you say things like "this is my final offer". If you can go from £222.5k to £225k, why not to £227.5k? 

Personally I'd either go for £220k, or just go in with £225k and make it clear this is the final offer with no more negotiation. Both of those just sound more credible.

blue_max_3

moodysocks said:

Unsurprisingly the offer was declined and the EA said: "The vendor is looking for something with a '2' and a '3' in it, and preferably at the higher end of that". So she wants over £230k. My family thinks this is a good thing, and said she's already nearly down to our max offer of £225.

£223k?

gwynlas

Personally I would be very annoyed and refuse to deal with purchase going up in small increments. If you really want the house then you need to be  close to 230 perhaps 228 explaining that this reflects the lack of maintenance need for redecoration etc.
This would still give you a discount of 5% if you are determined to bargain.

cybervic

Market is quite uncertain right now but good properties are still being sold at asking price in some part of UK. 
If 225 if your absolute maximum, then offering 7K more once and 3K more for the best final seems ok. However,  If the vendor already had several offers without having to reduce the price then your 225 offer won't be taken seriously anyway. You've said it yourself 240 is a good asking price, I think they've already given you a clear message they're unlikely to settle less than 230. 

MovingForwards

I made the offer on my home a few hours after viewing it, it was rejected after about 10 minutes (was supposed to think about it over the weekend) but I was told what the seller was looking for.
Put the phone down, gave it a few minutes and called back saying my new offer is what the seller wants and I wasn't going to argue over a few quid as it's a nice place.

I don't get the table tennis as if you keep inching it up every few days they could hold out thinking you will go to the sale price or someone else could come along and offer what the seller wants.

If you like and want the property just go in with your best offer.

UnderOffer

MovingForwards said:

I made the offer on my home a few hours after viewing it, it was rejected after about 10 minutes (was supposed to think about it over the weekend) but I was told what the seller was looking for.
Put the phone down, gave it a few minutes and called back saying my new offer is what the seller wants and I wasn't going to argue over a few quid as it's a nice place.

I don't get the table tennis as if you keep inching it up every few days they could hold out thinking you will go to the sale price or someone else could come along and offer what the seller wants.

If you like and want the property just go in with your best offer.

Similar experience to you. Made offer, rejected but told what the buyer would accept (5k more), I agreed and received phone call back to confirm vendor had accepted. 

OP Don’t go up in small increments, I’d make one final offer and explain reasons. Good luck. 

Jeepers_Creepers

moodysocks said:

Hi all,

Me and my partner are first-time buyers, we also have an unusually large deposit for our position (inheritance) and we put an offer in on a £240k house in (a cheaper part of) the southwest. It's a pretty good asking price for a house like this (semi-detached, 4 bed - two double, and two 'box' rooms we call them, with a garage), however it's been on the market for a year (over-priced? unlucky?).

We were told various things by the estate agent, first that the vendor is 'very motivated to sell' and has had 3 chains collapse over the past year, we believe the last time it was 'sold' was around Christmas time. They then backtracked two days later and said she didn't have anywhere to move to and as such was less fussed to move. Their words were 'if you offered asking price, she'd be out immediately', so who knows what to make of that.

We put our first offer in at £215k (12% below asking). The house is generally in good condition, but hasn't been maintained particularly well - mostly minor cosmetic things (e.g. broken cupboard doors, stained carpets and walls, loose paving out the back). However it's been on the market so long, and as the first EA said she was keen to move and sell to a chain-free buyer, we thought to start low and work our way up to a final offer of £225k (6% below asking), if it helps, the vendor bought it new in 2012 for £220k (identical houses in the estate sold new for between £210-£220). Honestly we can't ignore the fact that the economy has tanked and house prices are predicted to decrease. We're not even sure if it's wise to buy right now.

Unsurprisingly the offer was declined and the EA said: "The vendor is looking for something with a '2' and a '3' in it, and preferably at the higher end of that". So she wants over £230k. My family thinks this is a good thing, and said she's already nearly down to our max offer of £225.

Our second offer was originally going to be £220k. Now we have decided to split the difference between £215k and £230k and offer £222,500. She'll obviously decline that as well. We'll go in with £225 after a few days as a final offer.

I was just wondering what people's opinions are about this negotiation? Along with any advice on how to proceed. We really like this house, but we will walk away if the vendor doesn't meet us below £230k.

Thanks!

As said by others, take whatever the EA says with a pinch of salt. It could well be factually true, or it could be an abuse of a grain of truth - a Trumpian Truth, as it were. So, you don't know. But it doesn't matter. (I bet the EA is desperate to get this property off their books, tho'...)

If £225k is the max you are pretty certain you will go to, and would be happy to get it at that, then I think it would represent a decent discount on the original (clearly unrealistic - it hasn't sold in a year...) asking price. So, I would call up the EA and state very clearly '£225k, and that's it'. 

A decent EA should do the rest. 

moodysocks

Thanks everyone, we're going to phone the EA and offer the £225 as our final offer. Really appreciate everybody's input!

Houses around here are selling quickly (generally within 1 month) - this place has been up for a year, so buyers aren't biting at the price the vendor wants.

ciderboy2009

OP - not sure where in the South West you are but, here in Bristol, prices are on the whole still going up.

A neighbour put their house on the market on the weekend.  They bought it for £250k less than two years ago - it's now on the market for £290k. 

They've had a constant stream of viewers the last couple of days and already have an offer - they're currently waiting for all of the booked viewings to be completed before making a decision on it.

moodysocks

ciderboy2009 said:

OP - not sure where in the South West you are but, here in Bristol, prices are on the whole still going up.

A neighbour put their house on the market on the weekend.  They bought it for £250k less than two years ago - it's now on the market for £290k. 

They've had a constant stream of viewers the last couple of days and already have an offer - they're currently waiting for all of the booked viewings to be completed before making a decision on it.

We're in a much cheaper area than Bristol (thankfully!), house prices here have generally been slowly creeping up over the last few years, but nothing as drastic as 30k!

What I would classify as equivalent houses to the one we are offering on have been sold in the last 3 years for about 4% higher than what they were bought for in 2012, although some have been sold at a loss. They've sold in the last three years for between £209k and £230k.

Identical houses on the same estate were bought new for less than what our vendor bought hers for (by between 7k and 20k less), so I suspect she is trying to make as much of a profit a possible, when really the house was always worth less than what she paid.