Finding the perfect home is only the beginning of the house buying process. You have to compete with other buyers. And you have to be sure that you make the best offer for the property — without paying over the odds.
This process is often fraught with confusion, stress, and the unknown. After all, how do you know your offer is good enough without being excessive?
We know a thing or two about buying houses promptly. So we’ve put together a few tips for making the best offer for a property.
Speak with the estate agent
The estate agent isn’t just there to show you around the property. They’re there to answer any questions you might have. And it would be best if you had lots of questions. So before you view a house, compile a list of pertinent questions.
- Why are the owners selling?
- Are there any issues with neighbours?
- How is the local property market performing?
- Has the property undergone major repairs recently?
- Has there been much interest in the property?
Don’t be afraid to make a few notes at a time. The more information you can gather at this stage, the more accurate your valuation will be.
So, you’ve found the perfect home — the property of your dreams. But don’t go rushing in with an offer. And certainly don’t offer the asking price just because you want the property so badly. Remember: most agents and homeowners will add a little to the asking price to create a little wiggle room for negotiations.
Ask yourself a few questions before you submit your offer:
- How long has the house been up for sale?
- What were the sale prices for similar homes in the area over the last two years?
- Will you get the finance to cover the price you’re offering?
- Can you comfortably afford the repayments?
- Does the owner appear in a hurry to sell? And if so, why?
- Is there a lot of competition for the property?
- Do you think the owners would accept less than the asking price?
Making your offer
Start by setting a price ceiling. Work out the maximum you can afford, and stick to it. If you’re confident the vendors are in a hurry and that there isn’t a lot of interest in the property, then offer around £10,000 to £15,000 less than the initial asking price. In most cases, the seller will reject a low offer, but you never know. And this initial offer might give you an idea of an offer the owner might find acceptable.
If there’s a lot of competition for the property, you can’t afford to take too many risks. If the seller rejects your initial offer, ask the estate agent what might be accepted. If it’s beyond your budget, move on. But first, think about how the owners might view you. You might be in a position to move quickly, and that could give you the edge.
Issues that can tip the balance in your favour include:
- You’re a first-time buyer
- You already have a mortgage offer
- You’re passionate about the property
- You’re flexible about moving dates
- You’re a cash buyer
My bid is accepted. What next?
Don’t get too carried away if your bid is accepted, as this is just the beginning of the house purchase process. Ask the agent to take the property off the market. But be aware that there’s no legal requirement to do so. To ensure you get the home of your dreams, you need to act quickly.
The seller’s agent will create a document stating the property is sold “subject to survey and contract.” You’ll have a limited amount of time to get your mortgage, house sale (if applicable) and legal arrangements in order.
And don’t forget: in England and Wales, the seller can accept a higher offer without legal impediment. However, so-called gazumping is still an issue. Plan for this eventuality just in case the worst happens.
Knowing how and when to place a bid is crucial.
