House hunting and making an offer
Posted: October 2012
By Jo Eccles
After weeks of searching for a property for myself, we’ve finally found two houses which we like and are bidding on. If you’re in a similar situation and are about to make an offer, then hopefully the following tips might help you get a better outcome.
When you view a house you like, do make positive noises and ask questions, but don’t proclaim how much you love it to the agent, as they will use this against you – remember the agent is working for the seller and will report back to the seller!
Asking questions is a big part of negotiating. The more you can find out about the seller and the property, the more you can use the situation to your advantage. When you walk into a property, always ask how long it has been on the market as this gives a good indication of how much room there is to negotiate. For example, if the property has only been on the market for a day or so, it’s unlikely the seller will entertain a low offer. However, if the property has been on the market for a month or two, this will indicate room to negotiate as the property is clearly not worth what the seller is asking.
Also ask the agent why the vendor is selling. If the agent gives a vague answer, press them for more detail. You can mask it by saying you’d like to know their preferred time scales, so that the estate agent gets the impression you’re potentially keen and will be more likely to disclose information or go and find out. Sellers are not always motivated by price; they are often motivated by reliability and time scales too. For example, we have just had a client buy from a couple who were expecting their first child and were very keen to move by a certain date. Our client could accommodate the date and they chose us.
Once you know your seller’s motivation and you have an idea on how flexible the price is, then look at other properties which may have recently sold. These will give you an accurate price per square foot value for the property you want to buy. Unfortunately for buyers, this information is very hard to obtain – whilst you can look up sold prices on various online portals and websites, the information is not always accurate, and doesn’t provide information about what condition the property was in for example. In the absence of using a good buying agent, you can sometimes get hold of some rough figures which can guide you on the value.
Once you’ve decided what price you’re going to pay, then you can make your offer. Remember the more information you give in your offer letter, the better. You should say who you are, what you do, who your solicitor and mortgage lender are. These all make you look organised and reliable, which will put you in a favourable position to the seller.
If you have a question you’d like Jo to answer please email firstname.lastname@example.org or tweet her @joeccles.