Offering more than 10% lower after research

Sammyd159

As an ex estate agent and valuer, my advice is this:
I can tell you that selling prices are occasionally set by the vendor regardless as to what the agent values it at if the agent is desperate for listings.
Secondly, some agents over value properties to get them listed with them and this is more so in a market where there are fewer properties for sale.
Assuming the agent has valued it correctly, this could be based on supply and demand if it has jumped a lot in price. 
Also, as many others have said, a house is only worth what someone will pay for it at that time. That person could be you, even with a low offer. If a vendor needs to move asap then they might bite your hand off. It could also mean someone else is desperate to buy it and offer more. 
The EA's job is to get the best price for the vendor but also to negotiate the sale in a timely fashion, so if you really love the house you can submit your offer, you don't need to go into detail about your extensive research, just positive sandwich your position - FTB, your offer is x but you can move quickly already have a mortgage approved and a solicitor appointed (do this by the way it speeds up your transaction).
With regards to the garage / bedroom conversion, this is a concern and I would ask for clarification on it before you submit your offer.  from your description it seems unlikely that building regs have been approved, in this case they need to apply for it retrospectively.  This information will be asked by the solicitors during the conveyancing but it's really too late at this point if it is a deal breaker. It's entirely up to you whether you want to buy it without building regs if they can't or won't get it approved, but it would strengthen your argument for a reduced price.
Hope that helps.  Good luck, and remember, there are always other houses, everything happens for a reason, sometimes a better one is just round the corner.

Crashy_Time

jimbog said:

hazyjo said:

Unicorn_cottage said:

hazyjo said:

I've also had someone trying to get me to take a low offer while standing in my house eventually making me shake with anger and I was left in tears after shutting the door behind him and his missus. I told the EA they could offer me a million quid and I'd never sell to them and I didn't want to hear their names ever again.

@hazyjo - that sounds awful. Why would anyone do that?! 

Beats me. He honestly thought he could get a bargain. Kept pulling printouts of other houses details (some were even flats!) saying look at the price of this one. I was almost yelling saying well go buy one of them then! You can't compare what he was showing me against what I was selling. They were all in really horrible streets or areas. I also said I wasn't discussing financials and he should speak with the EA. His wife did have the decency to look embarrassed.

Ironically, in reality he was showing his cards as to being over keen on your house

Or put another way, he fancied the house, but thought it was overpriced.

seradane

bradyhv said:

MobileSaver said:

bradyhv said:

certainly overshadows any helpful intent you might have had.

You're welcome!

bradyhv said:

I still live with my mum and we have a 20% deposit which won't be spent on anything but a home but thanks for letting assumptions cloud your response

I apologise that I'm not a clairvoyant; clearly I should have known you were still living at home, silly me! Don't worry though, for those that can't afford to rent or buy, Crashy_Time's new backup plan is living with your parents so perhaps you'll be happy living with your mum for the next fifteen years while you wait for this £270k house to become available for £200k?

I never said you should have known my exact circumstances - just pointing out its not really appropriate to make unnecessary comments based on assumptions. Also you've again assumed I fall into the category of "those who can't afford to rent or buy" - I can, otherwise why am I even on this forum asking a question about making an offer. 
I guess I must have missed the part where I said I was going to run along with that advice and offer 200k for a 270k asking price, or where I said I would like to live at my mums for 15 years and wait. I must have also missed the part where sarcasm and judgement became a substitute for helpful advice. 

Brady, don't get too caught up in MobileSaver's comments, they're mostly digs aimed at Crashy_Time, not you.

Thought I do find it ironic that when someone asks here "What should I offer?" people always say "Well do your research!". Here you clearly have, and now people are like "Who cares!?". Some seriously rude people on these forums sometimes.

Back to the topic, I think that offer sounds perfectly reasonable. If the agent seems confused by the low price you can always elaborate a bit more as to how you came to that number.

When we were looking for a property, I came across one that was a bit of an ugly duckling - probate sale, rubbish condition, but good location and loads of potential. The house next door was a detatched instead of a semi and 50% larger and had sold quite recently, so I used that as a guideline to pro-rata my price down. In the end I offered 90% of the list price, and used the neighbors place as justification. The agent said 'Thanks for the explanation', but the vendor rejected the offer and feedback was they wanted asking. So we walked away. And I just checked - it's still for sale, still for the same asking price, and has now sat on the market for 2.5 years without sale.

Sometimes vendors are unreasonable, and all the reasoning in the world won't help, so go ahead and make the offer, and just be prepared to walk away without fuss if they don't come to the table.

hazyjo

Crashy and others, it was not negotiations it was bullying. He would not take no for an answer. I had to pretty much shout. He was talking utter shi**. Can't remember figures but think it was up for around £200k and he was offering £160k-odd. I remember saying to him why aren't you listening? He had absolutely no interest in it, he just wanted a bargain somewhere.

I sold for a couple of grand under the asking price. I'm not stupid, and knew the value of my house - certainly within ten grand lol.

The EA also knew what he was like and said that was the last straw and they told them where to go too.

hazyjo

Scotbot said:

Unicorn_cottage said:

hazyjo said:

I've also had someone trying to get me to take a low offer while standing in my house eventually making me shake with anger and I was left in tears after shutting the door behind him and his missus. I told the EA they could offer me a million quid and I'd never sell to them and I didn't want to hear their names ever again.

@hazyjo - that sounds awful. Why would anyone do that?! 

At a guess hazyjo is female and some blokes, who are pillocks,  think they are great negotiators and can intimidate women into dropping the price. 

Thank maybe one to do with me looking young (I was in my 30s but still getting asked for ID lol) rather than being female.

jimbog

seradane said:

bradyhv said:

MobileSaver said:

bradyhv said:

certainly overshadows any helpful intent you might have had.

You're welcome!

bradyhv said:

I still live with my mum and we have a 20% deposit which won't be spent on anything but a home but thanks for letting assumptions cloud your response

I apologise that I'm not a clairvoyant; clearly I should have known you were still living at home, silly me! Don't worry though, for those that can't afford to rent or buy, Crashy_Time's new backup plan is living with your parents so perhaps you'll be happy living with your mum for the next fifteen years while you wait for this £270k house to become available for £200k?

I never said you should have known my exact circumstances - just pointing out its not really appropriate to make unnecessary comments based on assumptions. Also you've again assumed I fall into the category of "those who can't afford to rent or buy" - I can, otherwise why am I even on this forum asking a question about making an offer. 
I guess I must have missed the part where I said I was going to run along with that advice and offer 200k for a 270k asking price, or where I said I would like to live at my mums for 15 years and wait. I must have also missed the part where sarcasm and judgement became a substitute for helpful advice. 

Thought I do find it ironic that when someone asks here "What should I offer?" people always say "Well do your research!". Here you clearly have, and now people are like "Who cares!?". Some seriously rude people on these forums sometimes.

I think you misunderstand. Yes, research is important but only so that (the buyer) can make a suitable offer. However for the EA and seller the are the ones who 'wouldn't care' from what rationale that offer was based. The OP here is a buyer

Jeepers_Creepers

Blimey, plenty comments :-)

Assuming that bradyhv's research is fairly accurate in suggesting that this property is overpriced, it seems to me that an obvious first Q to the EA is "Who valued it at this - the owner or you?"

If the former, then the EA will probably be glad of as much 'helpful' feedback from potential buyers as he can get so that he can hopefully talk the vendors down. That won't necessarily help the price, of course - it's likely only time will do that. 

Norman_Castle

Crashy_Time said:

Scotbot said:

Unicorn_cottage said:

hazyjo said:

I've also had someone trying to get me to take a low offer while standing in my house eventually making me shake with anger and I was left in tears after shutting the door behind him and his missus. I told the EA they could offer me a million quid and I'd never sell to them and I didn't want to hear their names ever again.

@hazyjo - that sounds awful. Why would anyone do that?! 

At a guess hazyjo is female and some blokes, who are pillocks,  think they are great negotiators and can intimidate women into dropping the price. 

Or maybe the bloke (or woman) thought it was a good time to lay their cards on the table, not exactly earth-shattering, you can still just politely tell them to put in their offer but you are hoping for a higher one, I really wish people would get over this idea that any discussion about the price of a house is a social taboo and highly offensive, do you realise how childish and silly this looks to large numbers of the public hoping for a meaningful correction? As if a normal bloke standing in his chinos with a coffee in hand with his missus is trying to "intimidate" someone into dropping their price just because he tried to negotiate! You lot do make me laugh sometimes.

A patronising, self important laugh that fools no-one.

MysteryMe

bradyhv said:

MysteryMe said:

I think you are wasting your time and everyone else's putting forward your "evidence"  justifying how you have arrived at your offer.  Just make your offer, provide relevant information such as FTB, finances in place, and if it's rejected you either increase it or walk away.  
IMO you would be spending your time more productively seeking out properties that do meet your criteria of a fair price.

I do think that’s a little rude as I never said I would put any of what I said above to the EA or the Vendor, why would wouldn’t I do research as well as a viewing to the help me reach an offer figure. Surely every lower offer has justification behind reaching it - I would be a fool to just pluck a misguided figure out of the air so I’m not really sure how I’m wasting my time - I was just trying to provide as much context as possible to get some advice. I think searching for properties in my criteria for a lower price is fairly obvious advice - I was more looking for some opinions on the offer process in similar situations but thanks for your time anyway I guess. 

In the same way you are pointing out you never said you were going to put your evidence/research to the EA, I never said don't do any research.  I quite clearly said putting your evidence to the EA is a waste of time, not that you doing any research is a waste of time.   
If you think the asking price of a property is at odds with your research then the question to ask the EA is "How did you arrive at the valuation please?" I am a great believer in the KISS principle but perhaps that is a bit too "fairly obvious."  
I gave you good advice on the important factors in your favour that you should be presenting to the agent.

Edit to say, as I think this is an important point.

The reason why you get the EA to explain how they arrived at the valuation rather than you explain why you think it is wrong and why is because if your research is flawed in some way you have weakened your position.  

Crashy_Time

Norman_Castle said:

Crashy_Time said:

Scotbot said:

Unicorn_cottage said:

hazyjo said:

I've also had someone trying to get me to take a low offer while standing in my house eventually making me shake with anger and I was left in tears after shutting the door behind him and his missus. I told the EA they could offer me a million quid and I'd never sell to them and I didn't want to hear their names ever again.

@hazyjo - that sounds awful. Why would anyone do that?! 

At a guess hazyjo is female and some blokes, who are pillocks,  think they are great negotiators and can intimidate women into dropping the price. 

Or maybe the bloke (or woman) thought it was a good time to lay their cards on the table, not exactly earth-shattering, you can still just politely tell them to put in their offer but you are hoping for a higher one, I really wish people would get over this idea that any discussion about the price of a house is a social taboo and highly offensive, do you realise how childish and silly this looks to large numbers of the public hoping for a meaningful correction? As if a normal bloke standing in his chinos with a coffee in hand with his missus is trying to "intimidate" someone into dropping their price just because he tried to negotiate! You lot do make me laugh sometimes.

A patronising, self important laugh that fools no-one.

Sorry, you have set me off again, what bit annoyed you this time?