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KatieDee
Posts: 709 Forumite
I've viewed quite a few properties over the past six months of my life, and I'm really starting to doubt my judgment.
We've had to pull out of one purchase, we've been beaten to another property and to top this off, we're buying in an area with very few houses coming up for sale. With a population of around 35000, there are probably 5 properties coming up each month that fall into our criteria.
I've always been told that when making an offer, you should start from a position with a good scope for negotiation - usually at 10% less than asking price. Every single time I have done this, I have been met by an absolute refusal from the vendor and it seems as though everybody is holding out for asking price or more. And looking at sold prices in the area...are houses really that much more expensive than 2017?
The area we're considering isn't exactly "high demand" compared to the city or the South - it's 35 minutes out of Manchester, close to the Peak District and a real mixture of houses. My original budget was between £180,000 - £205000 but this has now risen to £225,000 for a 3 bed semi-detached with a decent sizes garden and parking. We're finding that even this is stretching it, and that the houses at the higher end of our budget still need some things doing.
Am I just being unrealistic? I'm originally from the North and housing is a lot more affordable up there. I can't work out whether paying asking price is just what is done around this area, or whether I'm overpaying. Is this just a symptom of an area that is very close knit, where not much comes up? And should I feel bad/badly done to having to offer close to asking price, or is this just a sign of the times?
I appreciate it's a buyers market (or getting to that point) but I genuinely don't feel like I have any advantage. I suppose I'm reluctant to pay top whack for something if house prices in general are likely to stagnate! Also...I'm a Yorkshire lass, so I love a bargain :rotfl:
We've had to pull out of one purchase, we've been beaten to another property and to top this off, we're buying in an area with very few houses coming up for sale. With a population of around 35000, there are probably 5 properties coming up each month that fall into our criteria.
I've always been told that when making an offer, you should start from a position with a good scope for negotiation - usually at 10% less than asking price. Every single time I have done this, I have been met by an absolute refusal from the vendor and it seems as though everybody is holding out for asking price or more. And looking at sold prices in the area...are houses really that much more expensive than 2017?
The area we're considering isn't exactly "high demand" compared to the city or the South - it's 35 minutes out of Manchester, close to the Peak District and a real mixture of houses. My original budget was between £180,000 - £205000 but this has now risen to £225,000 for a 3 bed semi-detached with a decent sizes garden and parking. We're finding that even this is stretching it, and that the houses at the higher end of our budget still need some things doing.
Am I just being unrealistic? I'm originally from the North and housing is a lot more affordable up there. I can't work out whether paying asking price is just what is done around this area, or whether I'm overpaying. Is this just a symptom of an area that is very close knit, where not much comes up? And should I feel bad/badly done to having to offer close to asking price, or is this just a sign of the times?
I appreciate it's a buyers market (or getting to that point) but I genuinely don't feel like I have any advantage. I suppose I'm reluctant to pay top whack for something if house prices in general are likely to stagnate! Also...I'm a Yorkshire lass, so I love a bargain :rotfl:
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Tell that person (who said offer -10%) to stop giving you advice....0
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Tell that person (who said offer -10%) to stop giving you advice....
I think it's just a general opinion. The number of times I've seen "If you're not embarrassed by your offer then you're offering too much" on this website - it's hard not to be swayed by that.
I think this has skewed my view of house buying a little bit, as in my head I've always assumed that you could get a property for less than advertised in most cases, and that EA's price them with this in mind. I think if I could get some clarification on this either way, I'd probably feel less limited to what I can buy.0 -
Going in with a fixed strategy of "asking price less 10%" as you've noticed isn't always the best idea as the pricing structures aren't fixed.
Vendors are free to put their house up for sale for whatever price they want. If the survey says it's worth 220k-240k then it's up to personal preference what they want to do with that information. Some may decide to put it on for 240k so they have room for negotiation, some may put it on for 200k as they're worried about Brexit or may want a quick sale, and then may be understandably disgruntled when someone flies in with an offer of 180k.
There's no one size fits all, it's key to do your research and make an offer that reflects the market and your interest in the property.I think it's just a general opinion. The number of times I've seen "If you're not embarrassed by your offer then you're offering too much" on this website - it's hard not to be swayed by that.
I think this has skewed my view of house buying a little bit, as in my head I've always assumed that you could get a property for less than advertised in most cases, and that EA's price them with this in mind. I think if I could get some clarification on this either way, I'd probably feel less limited to what I can buy.
EDIT: I agree with this, it's almost expected to receive a discount on a property, and to feel ripped off if you don't get one. I think often this mantra is fine (as a lot of vendors will receive several valuations, list for the highest valuation and negotiate downwards, but if someone's not playing the game, you can see why it causes offense).
On a purely personal note, I do somewhat cringe when people suggest requesting 10-20%+ discounts. A 20% discount on asking is a boatload of money, I can't imagine it flies often.Know what you don't0 -
Going in with a fixed strategy of "asking price less 10%" as you've noticed isn't always the best idea as the methods behind pricing are't fixed.
Vendors are free to put their house up for sale for whatever price they want. If the survey says it's worth 220k-240k then it's up to personal preference what they want to do with that information. Some may decide to put it on for 240 so they have room for negotiation, some may put it on for 200k as they're worried about Brexit or may want a quick sale, and then may be understandably disgruntled when someone flies in with an offer of 180k.
There's no one size fits all, it's key to do your research and make an offer that reflects the market and your interest in the property.
EDIT: I agree with this, it's almost expected to receive a discount on a property, and to feel ripped off if you don't get one. I think often this mantra is fine (as a lot of vendors will receive several valuations, list for the highest valuation and negotiate downwards, but if someone's not playing the game, you can see why it causes offense).
On a purely personal note, I do somewhat cringe when people suggest requesting 10-20%+ discounts. A 20% discount on asking is a boatload of money, I can't imagine it flies often.
I completely agree - I have never, ever gone to 10% (usually start around 5%) but I do tend to think about the amount of money before considering it. It's like if someone said to me I could have a house, but then upped the price by 10%...I could never afford that. These vendors in most cases have new houses to buy, so to take that kind of a hit for a house that is perfectly sell-able is a bit unrealistic, now I think about it.
I think this is where I'm struggling. I find it hard to grasp the idea that if I pay top dollar for a house, that I'm going to make any money if I come to sell. If I pay less, then I leave some room for a profit in the eventuality that I do sell...but then the next person will probably try offering lower to me as well!
You are right though. I think what I want in my head is so specific that I really need to be realistic about my offers and stop trying to save money. If a house is in a good area, a good size and in good condition, a vendor is going to want to get the best possible price.
If a house is in bad repair or needs updating, isn't in a great area or is limited in size, the vendor is probably going to be willing to let it go for less and be more willing to negotiate.
Unfortunately I'm looking for the former :rotfl:0 -
If you're looking at late-18/early-19 sale prices, then clearly!I've always been told that when making an offer, you should start from a position with a good scope for negotiation - usually at 10% less than asking price. Every single time I have done this, I have been met by an absolute refusal from the vendor and it seems as though everybody is holding out for asking price or more. And looking at sold prices in the area...are houses really that much more expensive than 2017?
Any vendor can list at whatever they want.
You can offer whatever you want.
They don't have to accept it, you don't have to pay asking. All you need to do is find a point you agree. Maybe you can't... Next! If nobody wants to pay the price they're asking, they won't sell.
Offer too low, and you run the risk of the vendor having a huff and refusing to deal with you. Offer way too low, repeatedly, and you run the risk of the EA thinking you're a timewaster.0 -
I think this is where I'm struggling. I find it hard to grasp the idea that if I pay top dollar for a house, that I'm going to make any money if I come to sell. If I pay less, then I leave some room for a profit in the eventuality that I do sell...but then the next person will probably try offering lower to me as well!
I've just bought a house and if MSE has taught me anything, it's to offer what it's worth to you. I ended up receiving ~3.5% off asking price, but that was on the gentlemen's agreement that there's no further price negotiation unless something absolutely catastrophic came up in the survey and I have absolutely no regrets whatsoever. Likewise for you, I'd not concern yourself with 'profit on future sale' or 'not getting ripped off' and focusing on finding the house of your dreams within your price range. You also have the fallback of the mortgage valuation at least somewhat confirming you haven't paid completely over the odds.And looking at sold prices in the area...are houses really that much more expensive than 2017?
EDIT: Haha can completely empathise with you here! I looked at a house for £280,000 two months ago. I saw a previous listing of the house (by previous owners) with pictures that confirmed the house was IDENTICAL to how it was now - price had gone up £50,000. Just didn't sit well with me that someones sat in a house for 3 years and wants to make 50 big ones for the pleasure!! Regardless of house price increases, or whether they may have got it below market price, I just couldn't stomach that knowledge.Know what you don't0 -
When we had a standard estate house to sell back in the 1990s, we looked at the prices other sellers were asking and undercut them by £3000 (which was approx 5%). We needed to sell in order to move abroad, so didn't want a protracted sale. The drop in price was worth it for our peace of mind as the buyer offered asking price within 3 days of the house going on the market, and the rest of the transaction went like a dream.0
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I've just bought a house and if MSE has taught me anything, it's to offer what it's worth to you. I ended up receiving ~3.5% off asking price, but that was on the gentlemen's agreement that there's no further price negotiation unless something absolutely catastrophic came up in the survey and I have absolutely no regrets whatsoever. Likewise for you, I'd not concern yourself with 'profit on future sale' or 'not getting ripped off' and focusing on finding the house of your dreams within your price range. You also have the fallback of the mortgage valuation at least somewhat confirming you haven't paid completely over the odds.
EDIT: Haha can completely empathise with you here! I looked at a house for £280,000 two months ago. I saw a previous listing of the house (by previous owners) with pictures that confirmed the house was IDENTICAL to how it was now - price had gone up £50,000. Just didn't sit well with me that someones sat in a house for 3 years and wants to make 50 big ones for the pleasure!! Regardless of house price increases, or whether they may have got it below market price, I just couldn't stomach that knowledge.
I don't think I'd mind as much if I knew I could flog the same out for an extra £50k in a few years :rotfl:
The house I've kind of fallen for is on for the top end of our budget but it is lovely. Vendor has demanded full price but has since suggestion she may accept lower, as it has been on the market since July :eek:
I guess I'm worried that firstly, it hasn't sold so far (so we might have the problem if we sell in future) and secondly, we're paying top end for something that hasn't sold. It is beautiful though and completely suits our needs, so maybe I need to get a grip and stop being so tight!0 -
Your goal is to buy a house for what you think it's worth, acknowledging that you might have to pay over the odds to secure something that is perfect for you (if you're aiming for 5 years +) in it.
You shouldn't be looking at the guide price when making your estimate of what a house is worth. You should be looking at nearby sold prices and what other similar properties are available in the local market, making adjustments for specific conditions (access, outdoor space etc)0 -
I walk away if someone doesn't accept 10% below asking. I assume that vendors add at least that. Then there's the issue with the actual valuation - vendors can do what they like but it's up to the valuation for most people. No point wasting everyone's time.
But that is just me. I'm very cynical
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