What to offer - house in Liverpool (£250k asking)

PadreM

Hello All: Thinking of offering on an older house in Liverpool, sale price £250k.  The three sites mentioned in MSE's valuation tips (Zoopla, Property Price Advice, Mouseprice) broadly agree, and av of the three's middle valuations is £222.5.  With the caveats that no survey has yet been done and the internal condition may be above average (I'm viewing shortly) would the average of those three valuations be a reasonable offer basis (ie, 11% below asking)?  I don't say 'starting-point' because this is the average of the valusations, not the low end, such that at face value I shouldn't go much above £222.5 (the highest high-end valuation was £227k).  Assuming house is in good internal condition, does a max offer of £233 seem right?

I know online valuations are rough and ready; I also know asking prices are not unusually fantasy, such that a 'final' offer 7-10% below asking is reasonable (ie, reflects market value not fantasy value).

I'm a chain-free cash-buyer

Thanks for your kind thoughts!

Marcus

sidneyvic

Round my way most houses have been selling for up to 10% over their asking price. You haven't even seen the house so why are you even talking about putting an offer in ? My guess is it is a lot of house for the money i.e. well priced in which case there may be a queue of buyers lined up wanting to put serious offers in....

Mr.Generous

Marcus, you make a good case for offering below asking price, let's see if the vendor agrees in a market where most sales are coming in at or above asking.

Spiderroo

sidneyvic said:

Round my way most houses have been selling for up to 10% over their asking price. You haven't even seen the house so why are you even talking about putting an offer in ? My guess is it is a lot of house for the money i.e. well priced in which case there may be a queue of buyers lined up wanting to put serious offers in....

Yeh it’s 10-20% over asking where I am too. The only time you’d get an offer through for below is if the house had sat on the market for ages because it was overpriced to begin with. The estimates online don’t reflect the demand and supply of some areas accurately. 

OP - how long has it been on the market? What is the seller’s situation - do they need a quick sale? Has there been much demand to view? 

sienew

PadreM said:

Hello All: Thinking of offering on an older house in Liverpool, sale price £250k.  The three sites mentioned in MSE's valuation tips (Zoopla, Property Price Advice, Mouseprice) broadly agree, and av of the three's middle valuations is £222.5.  With the caveats that no survey has yet been done and the internal condition may be above average (I'm viewing shortly) would the average of those three valuations be a reasonable offer basis (ie, 11% below asking)?  I don't say 'starting-point' because this is the average of the valusations, not the low end, such that at face value I shouldn't go much above £222.5 (the highest high-end valuation was £227k).  Assuming house is in good internal condition, does a max offer of £233 seem right?

I know online valuations are rough and ready; I also know asking prices are not unusually fantasy, such that a 'final' offer 7-10% below asking is reasonable (ie, reflects market value not fantasy value).

I'm a chain-free cash-buyer

Thanks for your kind thoughts!

Marcus

Sadly right now most properties seem to be selling (at least in my area) more like 7-10% above the asking price. I know someone who recently paid 25% more than the asking price. It's very much a sellers market right now.

I'd still offer less but you've got to be careful as offering much lower might mean you aren't considered a serious buyer by the agent/seller.

PadreM

I take the point that the online valuations may not, or are not, factoring demand trends (why?)  But if property is routinely going well over asking, why is the selling price as is?  If it's to stoke interest, why, given demand?

House is fairly new to market; I'll ask about viewings.  When I last viewed (same area) I was given possible flannel about demand for viewings, great interest, etc...  but I had no difficulty getting my 9% below asking accepted (withdrew as survey concerning).  I'm sceptical of agents talking-up interest...  Another I offered on (below, but respectable) was declined by vendor for a better offer, only for that to fall-through.  As a cash-buyer they'd have had the sale, but when the EA came back to me I'd seen something else.

I'm not under pressure to buy: if offers are at or over they're welcome.

This from 02/2022:

'Liverpool (L) homeowners were reducing their asking prices by an average of £-5,357 (2.5%) over the last 12 months.

Home sellers in the L7 postcode dropped their prices by an average of £-10,833 (8%) to secure a sale.

Tracking 687 property transactions between December 2020 and December 2021, the average differences between asking prices and their actual sold prices lodged at the HM Land Registry are figured.'

PadreM

PS For the postcode I'm looking at, at Jul '22 av difference between asking and selling is showing as 3.5%.  Assuming reliable, on average vendors are not, then getting at or above asking price, but not far below it in Liverpool.  As a cash buyer it might be reasonable to assume that this also has a potential small discount value as, pending survey, the sale is relatively certain.  On the above figure, then, a starting offer 5% below, with a ceiling 3% below, looks 'averagely' reasonable.

PadreM

sienew said:

PadreM said:

Hello All: Thinking of offering on an older house in Liverpool, sale price £250k.  The three sites mentioned in MSE's valuation tips (Zoopla, Property Price Advice, Mouseprice) broadly agree, and av of the three's middle valuations is £222.5.  With the caveats that no survey has yet been done and the internal condition may be above average (I'm viewing shortly) would the average of those three valuations be a reasonable offer basis (ie, 11% below asking)?  I don't say 'starting-point' because this is the average of the valusations, not the low end, such that at face value I shouldn't go much above £222.5 (the highest high-end valuation was £227k).  Assuming house is in good internal condition, does a max offer of £233 seem right?

I know online valuations are rough and ready; I also know asking prices are not unusually fantasy, such that a 'final' offer 7-10% below asking is reasonable (ie, reflects market value not fantasy value).

I'm a chain-free cash-buyer

Thanks for your kind thoughts!

Marcus

Sadly right now most properties seem to be selling (at least in my area) more like 7-10% above the asking price. I know someone who recently paid 25% more than the asking price. It's very much a sellers market right now.

I'd still offer less but you've got to be careful as offering much lower might mean you aren't considered a serious buyer by the agent/seller.

sienew:  I understand.  The max 11% I mention doesn't, according to my reading, constitute unseriousness.  However, some posts below, I've found a tool that compares latest gaps between asking (Rmove) and selling (HM Land Reg) prices, which for Jul '22 varies across Liverpool postcodes from minus 2-ish to 8-ish %.  That's helpful, suggesting in most cases the scenarios others here describe - at to +10% - have not applied this year in Lpool.

sienew

PadreM said:

sienew said:

PadreM said:

Hello All: Thinking of offering on an older house in Liverpool, sale price £250k.  The three sites mentioned in MSE's valuation tips (Zoopla, Property Price Advice, Mouseprice) broadly agree, and av of the three's middle valuations is £222.5.  With the caveats that no survey has yet been done and the internal condition may be above average (I'm viewing shortly) would the average of those three valuations be a reasonable offer basis (ie, 11% below asking)?  I don't say 'starting-point' because this is the average of the valusations, not the low end, such that at face value I shouldn't go much above £222.5 (the highest high-end valuation was £227k).  Assuming house is in good internal condition, does a max offer of £233 seem right?

I know online valuations are rough and ready; I also know asking prices are not unusually fantasy, such that a 'final' offer 7-10% below asking is reasonable (ie, reflects market value not fantasy value).

I'm a chain-free cash-buyer

Thanks for your kind thoughts!

Marcus

Sadly right now most properties seem to be selling (at least in my area) more like 7-10% above the asking price. I know someone who recently paid 25% more than the asking price. It's very much a sellers market right now.

I'd still offer less but you've got to be careful as offering much lower might mean you aren't considered a serious buyer by the agent/seller.

sienew:  I understand.  The max 11% I mention doesn't, according to my reading, constitute unseriousness.  However, some posts below, I've found a tool that compares latest gaps between asking (Rmove) and selling (HM Land Reg) prices, which for Jul '22 varies across Liverpool postcodes from minus 2-ish to 8-ish %.  That's helpful, suggesting in most cases the scenarios others here describe - at to +10% - have not applied this year in Lpool.

That might be the case. I have heard lots of reports of people leaving bigger cities post-covid with WFH and lifestyle changes moving to towns/villages so that could be the difference.

RedFraggle

L7 is a very mixed postcode. I'd also be basing a decision on where exactly it is within L7. 

Spiderroo

PadreM said:

I take the point that the online valuations may not, or are not, factoring demand trends (why?)  But if property is routinely going well over asking, why is the selling price as is?  If it's to stoke interest, why, given demand?

House is fairly new to market; I'll ask about viewings.  When I last viewed (same area) I was given possible flannel about demand for viewings, great interest, etc...  but I had no difficulty getting my 9% below asking accepted (withdrew as survey concerning).  I'm sceptical of agents talking-up interest...  Another I offered on (below, but respectable) was declined by vendor for a better offer, only for that to fall-through.  As a cash-buyer they'd have had the sale, but when the EA came back to me I'd seen something else.

I'm not under pressure to buy: if offers are at or over they're welcome.

This from 02/2022:

'Liverpool (L) homeowners were reducing their asking prices by an average of £-5,357 (2.5%) over the last 12 months.

Home sellers in the L7 postcode dropped their prices by an average of £-10,833 (8%) to secure a sale.

Tracking 687 property transactions between December 2020 and December 2021, the average differences between asking prices and their actual sold prices lodged at the HM Land Registry are figured.'

You can generally gauge demand but how easy it is to pick a time to view and the type of viewings (open house vs tour, etc). We saw some where the open house was full within a day of going up on Rightmove so we knew they were popular! 

What offers are accepted aren’t an exact art, there’s loads of factors that influence it so I’d be wary of relying solely on data. In the same way you’re in no rush to buy sellers might be in no rush to sell so worth figuring out their situation.