Not sure how high to offer on this property?

Zm97

Hi everyone, firstly, thanks for taking the time to read this and respond.

 

My fiancé and I are in the very fortunate position to be able to buy a property in cash. The idea behind this is that hopefully by buying in cash we are more attractive to sellers. Also, for reference, we are first time buyers.

 

We recently started formally looking and have seen about 10 properties. We really liked one property which we saw on Saturday, which was on the market for 875. The property is really good for our purposes, but not quite perfect: it is quite far from my work / public transport and also it has a short lease of just over 100 years. We think 875 is overpriced and our ideal price would be 800-825 max. We floated this with the agent at the time, who said that the seller may accept ~800-850. We initially offered 780, on Monday. The agent (a different member of the office) called us on Tuesday, and said that the seller wouldn’t accept anything below 825. What would you do here? We think to jump from 780-825 would make us look too keen. We were thinking of potentially offering 805, and then walking away in the hope that they come back to us. However, we don’t really want to lose the property. We are also aware we’ve not seen that many properties so we may be jumping the gun. Looking for negotiation tips, ideally. Our parents suggested the 805 idea, but we feel quite worried we will lose it.

 

Thanks again for the help.

theartfullodger

You offer up to what it's worth to you, no more.

Of course you might lose it.  Someone else might be offering £900k right now, who knows.

Prices have always gone up... and down.  Are you comfortable with a drop?  

Zm97

theartfullodger said:

You offer up to what it's worth to you, no more.

Of course you might lose it.  Someone else might be offering £900k right now, who knows.

Prices have always gone up... and down.  Are you comfortable with a drop?  

Thanks for the advice, seeing as we started at 790, would you offer straight away at what it's worth say 825 or build up to it slowly? 

RelievedSheff

If you want the house go in at the best price that you think it is worth.

I really can't see the point in bitting and batting to save a few grand on an £800k plus property!

jimbog

I would send an email offering 810 as a final offer reminding them that you are cash buyers and have a solicitor on standby and see what happens

propertyhunter

You say you don't want to look too keen, but then say you don't want to lose it.

To be honest, you could offer in below £825k - normally the seller allows a little wiggle room (I know I did). If you lost it, would you be kicking yourself if you could have got it for £825k? That's the question. 

Please don't do what I did - offered low, regretted it and now having to view houses 50k higher. 

dodo1990

Don't go back and forth with incremental offers, it's just annoying from a sellers POV especially when saving £5-10k on a £800k property! We actually rejected buyers who were doing this.

Offer what you are willing to pay, and that's that. 

Mahsroh

When I first put mine on the market I had a low offer which I rejected straight away. I then had a couple of failed transactions and both times the same person came back with a revised offer. 

The 3rd offer was the first one that was acceptable in terms of the offer, but I declined straight away because I felt like he was playing games (and was more likely to try and gazunder later down the line). 

In other words don’t try and play games. If they’re saying £825k minimum if you think it’s worth it and can afford it, offer it. If you don’t / can’t then don’t. 

Who cares if you seem too keen? They’ll either accept it or they won’t. But personally at this point I wouldn’t play games by offering £810k after being told £825k is the minimum. 

MobileSaver

dodo1990 said:

it's just annoying from a sellers POV especially when saving £5-10k on a £800k property! We actually rejected buyers who were doing this.

Mahsroh said:

I declined straight away because I felt like he was playing games ... personally at this point I wouldn’t play games by offering £810k after being told £825k is the minimum. 

+1 

Not quite the same scenario but I rejected a higher offer on my last house from someone who initially bid low then tried to outbid the offer I subsequently accepted.

If you've been told the seller won't accept anything less than £825k but still try to offer less then there's a good chance you'll lose that property forever unless the sellers are desperate to sell. Only you can decide if that's a risk worth taking.

Zm97 said:

The property is really good for our purposes, but not quite perfect:

I'm sure you know but remember that there is no such thing as a perfect property. My £1m home is amazing but not perfect while my friend's £2m property down the road has compromises that I would never be able to live with. The point being that holding out for perfection would mean you waiting for an awfully long time so all you can do is find something that ticks at least most of the boxes.

HotPantsCruiser

How many other offers do they have?

ReadingTim

Go in at £820k - it's close enough to what they might accept to see if they're open to a proper conversation. 

If so, you've got £5k or so of wriggle room, if not then walk away and find somewhere where the seller's expectations are more closely matched to your own.