Cash Buyer - how much lower to offer?

getmore4less

Do proper research on pricings not noddy sites like Zoopla that is no better than getting crashy to do a valuation.

lookstraightahead

Any valuation at the moment is pie in the sky so the most realistic one is what you are willing to pay.

it sounds like the seller thinks they can ask for anything and probably expect it, so I think unlikely to come down,

but I still wouldn't offer what they're asking - just stick to your guns and walk away if they say no.

Slinky

Crashy_Time said:

IamWood said:

Buying houses is like buying stocks, valued by the future value or living standard there. I have gone through this process a few times (some with cash). I would simply offer the asking price if the property is too good to lose. Don't think I have made big mistakes so far.

 the average person probably does very little analysis of a house`s future value beyond what they think the monthly payment will be and that "houses always go up".

Unlike the far fewer than average like yourself who believe the crash is just around the corner. Zoopla may be wildly inaccurate, but then given how long you've been waiting for that crash, so are you.

Scotbot

340k is a 36% rise. It varies by area but that seems steep, my area prices have risen by 18% since 2018. RM house price reports Zoola and the ONS house price index should allow you to gauge the increase in your area. I doubt it is more than 20%. If you are not in a hurry wait and see if they reduce the price or offer 305 and say it's in line with house price inflation. My guess is they will come back with a counter offer, up to you if you take it.

Keswick1uk

I'd look at the whole situation as cash buyer is just one aspect. In fact, a letter saying a young couple love it and its their dream home would probably for me (rightly or wrongly) trump a cash buyer at same offer if the agent considered them able to get the borrowing following their enquiries. 

AdrianC

What it sold for a little while back is irrelevant. How does the current price compare to what else's on the market now?

The Zoopla wet-finger is irrelevant. Again, how does the current price compare to what else's on the market now?

How you're funding your purchase is irrelevant. It simply does not affect the purchase process unless the property is likely to be refused as security by lenders, or unless you're sailing to close to your maximum affordability that a potential downvaluation makes it unaffordable for you.

When you say "second home", you are taking the +3% SDLT into account? Again, not the vendor's problem. But if they care about their community, they may well prefer it to remain an actual home rather than being mostly empty. Or, instead of a "second home" for you, do you mean it's a BtL? How's the net post-tax yield work at the asking?

SpiderLegs

AdrianC said:

What it sold for a little while back is irrelevant. How does the current price compare to what else's on the market now?

The Zoopla wet-finger is irrelevant. Again, how does the current price compare to what else's on the market now?

How you're funding your purchase is irrelevant. It simply does not affect the purchase process unless the property is likely to be refused as security by lenders, or unless you're sailing to close to your maximum affordability that a potential downvaluation makes it unaffordable for you.

When you say "second home", you are taking the +3% SDLT into account? Again, not the vendor's problem. But if they care about their community, they may well prefer it to remain an actual home rather than being mostly empty. Or, instead of a "second home" for you, do you mean it's a BtL? How's the net post-tax yield work at the asking?

The question about how the 340 compares to other properties was asked on page one, but I haven’t seen it answered yet. As the single most relevant factor it’d be fairly useful to know in order to answer whether a 305 offer is sensible or not.

 

Falafels

In many scenarios, it's possible to get a discount for cash.

House buying isn't one of them, at least not if the property's mortgageable in the first place.

As a cash buyer, the advantage to the vendor is that the sale may be less complicated because there's no mortgage application, but even that's not necessarily the case. Some vendors nevertheless fear cash buyers because they can be less vested than someone who's gone through the whole process of applying for a mortgage, and more likely to mess them around.

When the money is finally handed over on completion, where it's come from is completely irrelevant. So, in answer to your initial question, approach your transaction in the same way that you would if you needed finance from a third party - and offer what you think it's worth.

caprikid1

"I don't see low offers as rude - a two letter reply doesn't waste much time - but offering significantly low is more likely to get a flat rejection than open a negotiation if that is what you want to do. "
Exactly this, if it is a take it or leave it offer great, if it's a property you really want a low offer could carry many negative connotations 

Scotbot

AdrianC said:

What it sold for a little while back is irrelevant. How does the current price compare to what else's on the market now?

It isn't irrelevant,  it's certainly not the only factor but its another tool to assess value, particularly if no work has been done.