Making an Offer on a Property When Buying

Tips on Making an Offer on a Property

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A Guide to Making an Offer on a Property

(after reading “What’s the right price?”)

This info. is for serious buyers wanting a particular property. Not developers with several options and no personal requirements to consider.

The following covers the usual process of open negotiation the sellers estate agent. Sealed bids however are becoming more prevalent. We deal with those later.

We can’t legislate for stubbornly foolish sellers or, if you are unfortunate enough to be the first person to make an offer. But remember this.....

Most buyers don’t know what price to ask for their house

They don’t know how to negotiate

They will constantly ask the agent for advice

He will give it to a certain extent but he has a different agenda to the buyer. If he can convince them to accept a low offer without damaging his credibility and reputation, he will do.

His commission will arrive all the sooner!

Be cool, downplay the amount you are willing to spend. Do not let anyone know how much you really want the property. Don’t reveal anything about your personal circumstances

Ignore that you have been told the buyer won’t accept less than so and so....That might have been a month ago, no one knows what he’s been anguishing about since then.

Start low, at least 15% below asking price, make it sound final, the seller
will ask the agent if you sounded as if you might increase the offer.

When the agent gets back to you with a rejection don’t give him an inkling how you are feeling, tell him you are looking at other stuff and will get back to him. Leave it a few days, certainly longer than he expected you to take.

Make your second offer, this should be less than 10% of the asking price, tell him it’s your final one, that its serious, that you are prepared to drop “all the other property considerations”. That you will proceed as quickly as possible.

OK you get another rejection, now is the time to state your position so...If you are not in a chain, have nothing to sell, have the finances in place.... tell the agent now. If not keep shtum, register your sincere disappointment and state that you will pull out in 24 hours. The agent has to report your reaction, his commission requirement may kick in and he may suddenly be on your side.

If you get no reaction and you really can’t live without the property, phone the owner apologise for playing games and offer him the asking price!

“You can’t win ‘em all”

Sealed Bids

This process can be a lot less stressful than negotiation. You make your bid and that is that, you either win or lose. Just make sure that.....

You stick to your budget, don’t be tempted to bid far too high, you might just get it!

Your mortgage company may not cover you for too high a bid, so make sure you have adequate finances to cover a serious overpay.

Always offer a few more pounds and pence than a round number. For example, offer £650,100 rather than £650,000 just in case another bidder offers that round number.

Note this

In England and Wales NOTHING is final and legal, until both yours and the sellers solicitors have exchanged contracts.

Sellers and buyers can pull out at any time leaving the other with solicitor’s and possibly surveyor’s bills to pay

Gazumping is not illegal... (The seller pulls out of your deal to accept a higher offer)

Sellers do not have to remove their property from the market.

A Guide To The Process of Buying/Selling a Home/House/Flat