Making an offer / guide price

Connoisseurus_Rex

Just wanted to get some advice. I’ve found a property that I like, by no means perfect but it fits my needs. Thinking of making an offer but unsure what to offer. It’s listed with a guide price, I’d like to go under that but unsure if that’s reasonable given the market (even if it has cooled a lot). 

I appreciate this is a very difficult thing to comment on without all the details but in terms of %. Would it be crazy to offer say 4% under the guide price and go from there? I don’t want to offend the vendor or give them the impression that I’m difficult, but it’s a transaction at the end of the day.

pipscat

You can offer whatever you want - they'll soon let you know if they'll accept or not. I guess it depends on what you think the house is worth and what you'd be prepared to pay - top end! But the seller will more than likely have a figure in mind that they are looking to accept at.

If you didn't think it was more than you're willing to offer would you be happy to walk away? 

DE_612183

4% of what is also a question.
The biggest question is how much do you want the property?
If you really, really want it - what happens if you miss out due to a few £100?
What price is it selling for?

Connoisseurus_Rex

DE_612183 said:

4% of what is also a question.
The biggest question is how much do you want the property?
If you really, really want it - what happens if you miss out due to a few £100?
What price is it selling for?

370k - so would 355 be an “acceptable” place to start (without knowing anything else about the property)

Megaross

View it, look what other properties in the area sold for, offer what you think it's worth based on your research. Worst they'll say is no.

user1977

Connoisseurus_Rex said:

DE_612183 said:

4% of what is also a question.
The biggest question is how much do you want the property?
If you really, really want it - what happens if you miss out due to a few £100?
What price is it selling for?

370k - so would 355 be an “acceptable” place to start (without knowing anything else about the property)

I wouldn't be making any offer if I didn't know anything else about the property! I would be forming my own assessment of its value, not basing it purely around the asking price.

Connoisseurus_Rex

Megaross said:

View it, look what other properties in the area sold for, offer what you think it's worth based on your research. Worst they'll say is no.

Easier said than done when the backlog on sale prices is several months

donutandbeer

Connoisseurus_Rex said:

Megaross said:

View it, look what other properties in the area sold for, offer what you think it's worth based on your research. Worst they'll say is no.

Easier said than done when the backlog on sale prices is several months

To get a sense of recent prices you have to look at similar properties in the area that are now “sold stc” but have not yet completed. Obviously you won’t know how much the offers are for now, but you can see how much they were listed for and perhaps how quickly it went sold stc, and whether there was any reduction in price. Once you have been viewing and making offers for a while in the area you will know roughly how much things are sold for if you have made offers and were rejected. If you have just started then yes it’s very difficult. 

In our area if you offer 355k on a place listed for 370k you are unlikely to hear back from the estate agent much, but that’s assuming lots of things like assuming the property is averagely, reasonably priced (to recent properties), and assuming your local market is as seller-dominant as ours in London/south east. If the property has been on the market for a while without being sold then perhaps they will accept a much lower offer but kind of unlikely if they have just put it on the market (unless they are desperate!? But then desperate seller probably wouldn’t put their property on an unrealistic price).

At the end of the day you offer however much you want. They might come back saying no and then you can increase your offer. I normally start out by asking the estate agent if there’s other offer and how much roughly they are. They won’t give a clear answer but usually will say things like “just about guide price”, “on the guide price” or “a fair bit above guide price” .etc when pushed. 

Edit: Just to add that when we put our property on the market in March we received so many offers, our estate agent didn’t bother to talk to (as in checking their positions) buyers who offered below the guide price. If your market is like our market then there might be risk in offering too low to start.