Preparing to make an offer as first time buyers

cactushead1982

My partner and I are almost ready to make an offer on a property. It is within our price range and is near perfect for us based on size and location. We have our Mortgage in Principle and we can move as quickly as needed for the sellers. 

The property has only been on the market for a few days. We were thinking of offering 20k less than the asking price (Roughly 550K). 

Any suggestions for what we should include in our offer to make it more likely to be accepted? Is offering 20k less than the asking price when it is so new to market worth risking?

bryanb

You can always increase your offer later, but it’s not so easy to reduce it

gwynlas

Yes people usually expect offers and you can  say it is at the top of your budget but you are chain free.
Anyway it will be subject to survey and surveyors almost always comment on something to cover themselves and justify their fee.

Is there anything obvious you could mention that needs money spending on such as modernisation of kitchen or bathroom? Even redecoration if they have used strong accent colours or large areas needing reflooring?

It is probably a good time to be looking as many people will not want to sell with Christmas looming.

Albermarle

cactushead1982 said:

My partner and I are almost ready to make an offer on a property. It is within our price range and is near perfect for us based on size and location. We have our Mortgage in Principle and we can move as quickly as needed for the sellers. 

The property has only been on the market for a few days. We were thinking of offering 20k less than the asking price (Roughly 550K). 

Any suggestions for what we should include in our offer to make it more likely to be accepted? Is offering 20k less than the asking price when it is so new to market worth risking?

There are no hard and fast rules as every situation is different, and everybody is different.

In your situation, as you really like/want the house then you could just offer the asking price, which will obviously increase your chance of getting it.
On the other hand if you do that, you will wonder whether you could have got it cheaper.
However if you bid low, you might be outbid.

I think typically houses are sold for around 5% less than the asking price, but that is just an average.
Sellers tend to be more resistant to reductions when the house has only been on the market a few days.
I think £20K off seems OK, but the seller will probably see it as just an opening bid and ask for a higher price.

Hoenir

cactushead1982 said:

My partner and I are almost ready to make an offer on a property. It is within our price range and is near perfect for us based on size and location. We have our Mortgage in Principle and we can move as quickly as needed for the sellers. 

The property has only been on the market for a few days. We were thinking of offering 20k less than the asking price (Roughly 550K). 

Any suggestions for what we should include in our offer to make it more likely to be accepted? Is offering 20k less than the asking price when it is so new to market worth risking?

Make an offer. See what the response is. You might not be the only party with a keen interest in the property. 

SDLT_Geek

cactushead1982 said:

My partner and I are almost ready to make an offer on a property. It is within our price range and is near perfect for us based on size and location. We have our Mortgage in Principle and we can move as quickly as needed for the sellers. 

The property has only been on the market for a few days. We were thinking of offering 20k less than the asking price (Roughly 550K). 

Any suggestions for what we should include in our offer to make it more likely to be accepted? Is offering 20k less than the asking price when it is so new to market worth risking?

If the property is in England then you should look into the rules about stamp duty land tax for first time buyers.  It is worth checking whether you both qualify as first time buyers for SDLT purposes.

If you do, you will want to complete by 31 March 2025.  Up to then it is possible to claim the relief on a property bought for up to £625K, after that date, the benefit is limited to properties bought for up to £500K.

As an example, first time buyers who buy for £550K by 31 March 2025 who qualify for the relief would pay SDLT of £6,250.

If they complete on or after 1 April 2025 the SDLT would be £17,500.

Myci85

I would put your offer in, stating your situation, e.g. chain free, keen to progress on your purchase as quickly as possible, and see what the response it. Have a think what the property is worth to you as a maximum, e.g. what amount would you wish you'd offered if you end up losing out to someone else, and what amount is too much. Then if they open negotiations, you know what your ceiling is. 

You could always have a chat with the estate agent first too, ask if they've had any offers yet, and whether the EA thinks they'd be open to offers below asking price. Find out the vendor's position too, e.g. have they already found somewhere and want to move quickly, or are they waiting for an offer on theirs before looking. 

Hopefully now is a good time to be the buyer as they may not have much other interest and if they've just gone on the market, I wonder if they are wanting a quick sale, otherwise some people might have waited to go on after Christmas. On the flip side, if you really love the house and would be gutted to lose out, don't waste too much time negotiating if you can afford asking price or close to.

ReadySteadyPop

cactushead1982 said:

My partner and I are almost ready to make an offer on a property. It is within our price range and is near perfect for us based on size and location. We have our Mortgage in Principle and we can move as quickly as needed for the sellers. 

The property has only been on the market for a few days. We were thinking of offering 20k less than the asking price (Roughly 550K). 

Any suggestions for what we should include in our offer to make it more likely to be accepted? Is offering 20k less than the asking price when it is so new to market worth risking?

You need a valuation from your lender to know if you are even in the right ballpark? Lenders are "down-valuing" more now due to credit market risk. Unless you are planning on staying for a long time be aware that making too high an offer could translate into a loss when you come to sell.

Ksw3

The only thing that worked for us was telling them we already had a conveyancer lined up, meant we were serious and could move quickly....although the sale took 6 months due the sellers conveyancer being pants  

Bigphil1474

On a £550k marketed price, I'd expect the EA valued it in the region of £525 to £550k. Depends on the house - empty ex rental or probate house, you can usually offer less as they are usually keener to get rid. Family home where they are looking to move on, will want money for their next purchase. 

Personally, I would offer around £520k given the market is currently slow, pointing out you are a FTB and finances are in place. 

TheJP

OK so a few questions;

1. How did you arrive at the £20k less than asking price offer? You need to back it up.
2. FTBs are not the market controllers anymore, if anything many sellers dont want to sell to FTBs. (this is dependent)
3. Sure make an offer but if its very low, a seller may not want to entertain any further offers (tyre kicker scenario)