How Do I Make A -40% Offer

[Jason]

To be honest, they are several houses I like which I would be happy buying. When I estimate the summer 07 peak value, they come in around £250-270k; with most similar selling at 250k for the stamp duty threshold (they may have given a little extra for fixtures & fittings).

I would be happy buying one of these for about £175k, currently listed at £235k. Somehow, I can't see the vendor or EA taking me seriously.

Shall I even bother viewing it?

[silver surfer]

To be honest, they are several houses I like which I would be happy buying. When I estimate the summer 07 peak value, they come in around £250-270k; with most similar selling at 250k for the stamp duty threshold (they may have given a little extra for fixtures & fittings).

I would be happy buying one of these for about £175k, currently listed at £235k. Somehow, I can't see the vendor or EA taking me seriously.

Shall I even bother viewing it?

Jason, I'm also in the market, or I would be at 30% or more below peak 2007 prices! Here's how I'm going about it.

I politely explain to the EA, before we've discussed any specific property, that I'm a cash buyer but I'm only prepared to offer 30% below peak prices. I then detail the type of property I'm looking for, number of bedrooms etc, and finally I ask if he has any properties that fit the bill?

Surprise, surprise, they usually do.

It's clear that almost all EA's are carrying two books, a portfolio of "motivated sellers" and a portfolio of "deluded non-vendors". And the proof that they clearly segment their business this way is that they can immediately identify which of their properties are in which camp.

So why do they bother cluttering up their windows with in-denial vendors asking unrealistic prices?

Two reasons. Rightly or wrongly they all believe it's important to keep their brand of "For Sale" boards prominent in the neighberhood. Secondly, there's always the off-chance that someone will fall in love with a particular property and throw commercial logic out of the window.

I haven't had an offer accepted yet, but I've been very close and I'm getting closer by the day. Moral of the story. Talk price parameters before talking specific properties.

Good luck!

[Mildura]

Jason, I'm also in the market, or I would be at 30% or more below peak 2007 prices! Here's how I'm going about it.

I politely explain to the EA, before we've discussed any specific property, that I'm a cash buyer but I'm only prepared to offer 30% below peak prices. I then detail the type of property I'm looking for, number of bedrooms etc, and finally I ask if he has any properties that fit the bill?

Surprise, surprise, they usually do.

It's clear that almost all EA's are carrying two books, a portfolio of "motivated sellers" and a portfolio of "deluded non-vendors". And the proof that they clearly segment their business this way is that they can immediately identify which of their properties are in which camp.

So why do they bother cluttering up their windows with in-denial vendors asking unrealistic prices?

Two reasons. Rightly or wrongly they all believe it's important to keep their brand of "For Sale" boards prominent in the neighberhood. Secondly, there's always the off-chance that someone will fall in love with a particular property and throw commercial logic out of the window.

I haven't had an offer accepted yet, but I've been very close and I'm getting closer by the day. Moral of the story. Talk price parameters before talking specific properties.

Good luck!

There is a third reason.

They hope that the in-denial sellers discover reality and agree to reduce their price.

An EA can't sell a house that's not on their books.

[pele]

A little story for you to ponder

Wife is a solicitor in probate (death)

Just been given a property to deal with and sell

contacted agents and had a good chat about the market how things were (remember she is also trying to get a feel for the market because she is a big bad bear like us all here)

Agent decides to market the property (bungalow nice area) £249,000

I come home slating the agents just like you all would saying he is in cloud cookoo " he will never get that"

10 days later agent telephones at work

" We have had a really low offer and I dont think we should accept it"

what was the offer................ £229.000

Agent tell her not to accept the low offer.

1 week later and it is sold for £239.000

you do the maths

She is saying this is not a one off

Im all up for a bargin and Im sure we are all in the same camp

50% peak to trough,we have come a long way in a year, last Feb none of this negative talk was main stream

but we have a long long journey left....

good luck with your offers but Auctions are 6/12 months ahead of agents in price terms thats were the bargins are at the momment

[gabriel959]

AS most of us, I have been keeping a close eye to the property market for the past few months. I saw clear declines from September to December but it seems thinks are starting to pick up … I have no scientific evidence (only a bit of info from rightmove and my calls) but this is the evidence I have found:

2 weeks ago I went to see with the wife a res. Dev in Stow Cum Quy - Cambridge for a 3 bed property. They had 4 available for sale – I called yesterday, 3 reserved and 1 under offer!! Ok – the builders had reduced the price from a ridiculous £299.950 to a more reasonable (but still inflated imo) £240k. The houses are nice, but no way they are worth £240 (or even £220k!) when they are not even in Cambridge. But it seems they are as they are now gone! Ho-hum!

Also, some houses I got shortlisted in the Cambridge area have been going up – like one in Fen Ditton, one in Teversham is now under offer, the same goes for a few in Cambridge.

Guys, what if we got it all wrong and prices are really starting to pick up? 

Your opinion?

Cheers

[GrillsBears]

AS most of us, I have been keeping a close eye to the property market for the past few months. I saw clear declines from September to December but it seems thinks are starting to pick up … I have no scientific evidence (only a bit of info from rightmove and my calls) but this is the evidence I have found:

2 weeks ago I went to see with the wife a res. Dev in Stow Cum Quy - Cambridge for a 3 bed property. They had 4 available for sale – I called yesterday, 3 reserved and 1 under offer!! Ok – the builders had reduced the price from a ridiculous £299.950 to a more reasonable (but still inflated imo) £240k. The houses are nice, but no way they are worth £240 (or even £220k!) when they are not even in Cambridge. But it seems they are as they are now gone! Ho-hum!

Also, some houses I got shortlisted in the Cambridge area have been going up – like one in Fen Ditton, one in Teversham is now under offer, the same goes for a few in Cambridge.

Guys, what if we got it all wrong and prices are really starting to pick up? 

Your opinion?

Cheers

That we're seeing flight from cash to property which for some reason people haven't worked out is actually still a terrible way of losing money.

Mortgage lending ain't back to anywhere near levels required to sustain price rises.

PS you're still talking asking prices. 240 - 15% is £204k. With savvy negotiating with a panicked builder you might manage 20% off asking........

Edited January 28, 2009 by GrillsBears

[gabriel959]

That we're seeing flight from cash to property which for some reason people haven't worked out is actually still a terrible way of losing money.

Mortgage lending ain't back to anywhere near levels required to sustain price rises.

PS you're still talking asking prices. 240 - 15% is £204k. With savvy negotiating with a panicked builder you might manage 20% off asking........

Indeed, I don't know which prices were agreed for those properties to be honest - but as I said they had already been dropped £60k. Doubt it would have gone down that much. Do you think I could call them to ask them what the offers were like?

[rw42]

I'm trying to remain neutral in this - i offer what i think it's worth, if they accept then success, i has a flat. If they reject, then success, i know prices will drop further and i'll be able to pick it up cheaper later!

[GrillsBears]

Indeed, I don't know which prices were agreed for those properties to be honest - but as I said they had already been dropped £60k. Doubt it would have gone down that much. Do you think I could call them to ask them what the offers were like?

Original price means nothing. Prices in the last 10 years have been guesses driven by greed and lax lending. Securing a decent mortgage rate at a decent multiple is now considerably harder. Builders know this better than private sellers. If they could afford to bin 60k they can probably afford more.

You could always ask....only if you like being lied to.... However you could wait and check land registry figures. Alternatively you could still make an offer at a price you're happy with. They can only say no.

[R K]

Anecdotal - A friend's elderly mother has just put her family home on the market to move into a retirement flat. Put it up at £600k (agent's realistic to sell price). They are expecting a long wait but would accept £500k. i.e. nearly 20% off without a fight.

So, low offers are certainly worth making.

[HAIR BEAR CRUNCH]

if youre looking to get a good deal on anything, one rule of negotiating is that if you are not embarrassed by your first offer, then youve offered too much to begin with.

thats right remember house prices are NOT crashing they are drifting to a sensible level. the gas has only been turned off let the boiling pot simmer a while before enjoying.. i like my soup lukewarm , wait a while.. In the future people at dinner parties wont gloat about how much moolah theyve made, theyll gloat over how much they saved when they found some poor sod with his tongue hanging out. " MY HOUSE WAS 725K IN THE BOOM AND I JUST NICKED IT FOR 450 ETCETCETC

[dances with sheeple]

i wouldnt make any moves or offers in the middle of a crisis fast on its way south.

you DO NOT KNOW ehn the bottom will be reached. it could be up to 50-60% less than its current price by next year.

relax - your earning-saving £1500 pcm by not doing anything.

now thats HPI in reverse. enjoy it for as long as you possibly can.

dont get lumbered with debt.

Agreed.100%.

For a laugh you could look the EA right in the eye, and in the most serious Rab C. Nesbit/ Colonel Blimp (you choose) voice you can muster say "Listen laddie, I was makin` offers on houses when yer Ma was still playin` spin the bottle at school. This crash is going to wipe you, your boss and all your sheeple customers down the drain if you`re not careful. Take it or leave it" Relieve yourself on his feet and leave them a contact number? Obviously the vernacular would change depending on whether you are playing Rab C. or the Colonel, but you get the idea. All EA`s/developers are just there to be loudly laughed at just now. Any of them getting cocky just needs to be laughed at and walked away from (while still laughing)

[peahead]

I'm in absolute shock - can't get viewings booked for love nor money...

agent can't make it - already booked up - vendor can't do early mornings, vendor only wants proceedable buyers to view etc...

and yet I work in property and have own house on market and know it's dead out there... can't work it out??

Are there 2 types of people out there? The ones that know we are all fooked and the ones who are still on planet kirsty?

[shakenvac]

and yet I work in property and have own house on market and know it's dead out there... can't work it out??

Are there 2 types of people out there? The ones that know we are all fooked and the ones who are still on planet kirsty?

I've bolded the bit wrt why they don't give a stuff about you viewing!