Putting in low offers

[TulipsFromThreadneedle]

35 minutes ago, Impatiently Waiting said:

People on here have their heads stuck somewhere.

 

Putting in offers massively under the listing will just piss everyone off. 10% success rate is a nonsense as well. No way will 10 out of 100 low ball offers succeed. 

 

Just check your local sold prices and see how many went for 20,30 or 50% under listing price.

 

I'm in Scotland where house prices have been pretty static since 2007. I've been looking at rightmove near enough everyday for my area and also check sold prices when it is updated. In all that time I don't think I've seen more than a 5% difference.

yes thats the truth. I used to put low bids in around 2012 -3013 when the market was stagnant and got nowhere. Even now when I offer cash at 20% off bubble prices off derelict unmortgageable houses the offers at best get a polite no.

 EAs are just monkeys passing on messages doubt they'd ever influence over such offers as it was then who valued it.

[GreenDevil]

19 minutes ago, AvoidDebt said:

 

We got 20% off a year ago which was a six figure amount.

Took the vendors 3 months to decide to accept though 

They will only accept low ball if

there are very low viewing rates and poor feedback

You are the only person they can sell it to

You are the only person they think they can sell it too if they tell you ****** off.

If you get the right vendor it will work, ask me how i know, i got 15% of asking once, off already good price that was cheap, but the market these days is much stronger (due to low supply and cheap and free easy QE printy printy money)

[keeprenting]

The bottom line here is that you have to let the market do your dirty work for you.

It is only possible to get a property at a discount of 10%+ if the rest of the buying market backs you up and refuses to pay within 10% of asking price.

And to achieve this, you have to give the market time (months) to make clear to the seller that it is backing you up.

Even then, you have to hope that the seller actually wants to sell rather than saying "I'm not giving it away"/ taking it off the market/ letting it fester at an unachievable asking price.

[ingermany]

Been looking to buy in UK, East Midlands. Cash purchase in range 300 to 350.  Prices seem firm and stock levels low. Very little for sale. 

House 1 listed at 325k . Offer 298 rejected. Vendor counter 315. We almost took that but decided to walk rather than negotiate. 2 weeks later house was relisted at 308k. Eventually sold after 3 months. Guesstimate sub 300. Agent was really fair and professional. House just wasn't right for us. 

House 2 listed at 320. Offer 300....accepted immediately. Damn...too high. Survey showed some significant structural issues. I requested reduction to 280k. Owner countered at 297. Walked away again. House relisted at 320 now. Agent was an amateur. Failed to communicate with seller. Wanted our survey report for free. Given extracts from report via solicitor.....just failed to read the words like "in urgent need of" and "asbestos". Said that survey "reads positively". Obviously thinks that original price is achievable. 

Both houses had been bought in the last 15 years and would have made the seller a small profit...20 to 30k. Not life changing though, but people obviously feel they can't let a house go if they are being offered something close to their previous purchase price. In both these cases this was an issue. 

Now renting and watching. Despite low stock, immediate reductions of 10% almost guaranteed if seller really wants to sell. This will take time. If economic news continues on this trajectory, eventually prices will correct. 

[Roman Roady]

I remember thinking that prices were mad 16 years ago....we should have had the correction in 2005, then 2009 but they insisted on pumping and pumping.

What we need is distressed sellers before we pile in with the "30% OF" offers....and we WILL get them.

Thats why I have waited for so long and will continue to do so.

In the intervening years, the kids were educated, grew up, left home, got jobs and I now contract for 18month/2 yr periods at a time.

The wife does as she likes, its a good life its lucrative and I enjoy it; being a home owner would clip my wings somewhat now.

Who could have asked for more over a 16 year period?

Buying a house at 30% of its asking price with cash (liquidated PMs) will now be part of a retirement plan for me.

 

There is no need for any 3 bed semi in the UK (outside of London) to be worth more than 60 Gold Britannias impo.

The further out it is from the SE the more that figure drops.

That will change (in our favour) as BREXIT unwinds.

 

Its all "make believe" "funny money" at the moment...get on with your lives in the meantime, it will all come good in the end and the end is not far off.

[InlikeFlynn]

14 hours ago, Grab_Some_Popcorn said:

Having viewed, I think an offer of 30% of asking would be about right.

Yes "of", not "off".  It was a stinking house that has not been decorated or updated in anyway in 50 or 60 years. Filthy. Needs stripping out, rewiring, new plumbing, new skirting/doors, re-plastering. Hideous.  

 

There's some good advice on this thread, I would resist the urge to "play hardball" and try and keep the EA onside if I were you. you may need to deal with them in future.

The house is clearly overpriced.  The EA's comments suggest that the vendor has set an asking price above the level they recommended.  If this is the case then the EA will be trying to work the vendor's expectations downwards so would probably welcome an "insulting" offer in the knowledge it won't be accepted but might help persuade the grasping cumnts vendors to reduce their price. Whether you want to do the EAs legwork for them is up to you. I wouldn't get involved in this. As the house is so fresh on the market you are unlikely to reach an agreement by putting in an offer at this stage.  If you are interested I would wait for the EA to get in touch then explain that you think the house is suitable but that the vendors price expectations are so far from yours that you can't see an agreement being reached and therefore won't be making an offer. You can always come back in a few months.

My experience of houses in need of renovation is that buyers always underestimate how much work (and money) is required to bring the house up to scratch and therefore pay too much. 

Good luck

 

 

Edited May 20, 2017 by InlikeFlynn

[Guest]

I've let the EA know that even at half the price I probably wouldn't be interested.

[John51]

2 hours ago, InlikeFlynn said:

My experience of houses in need of renovation is that buyers always underestimate how much work (and money) is required to bring the house up to scratch and therefore pay too much. 

 

 

 

I know a couple of guys that bought property that needed a lot of work. Consensus from them was that you need to have a good income because it WILL go well over budget getting it in shape.

I once worked with some Ugandan Asians. Amazing people. They came here with next to nothing and built a good life within a decade or so. 

No mortgages, it's all family money. Young guy is getting married, he borrows from every relative he can. His dad goes door knocking on every suitable house with a for sale sign. Low offer but if the vendor agrees now, contracts will be exchanged in less than a week.

One workmate was extra cheerful one Monday morning. Over the weekend, some cousins had repaid the £50 they each owed him. (This was 1980.) Thursday morning he looked miserable. His brother was getting married and was expecting a £500 loan from him.

 

 

 

[janch]

5 hours ago, Roman Roady said:

What we need is distressed sellers before we pile in with the "30% OF" offers....and we WILL get them.

+1

It's worth making low offers because we usually don't know the seller's circumstances.  It could be they're desperate to sell as they're about to get repossessed etc etc  (or BTLers about to be made bankrupt).  Usually it won't work but you might strike lucky........at least that's what I'm hoping for.

[long time lurking]

On 5/19/2017 at 1:51 PM, Grab_Some_Popcorn said:

Viewing a house today with the expectation of putting in a very low offer. Any tips? It's been on market for a week. Doer-upper. Big south facing garden. 

Best to wait until it's been on market for longer and they're getting desperate?

I'm currently fighting with landlord to get our off-peak immersion heater fixed... Has reminded me why I hate renting sometimes. Hence viewing a house to buy

I you are not embarrassed by your offer it`s to high 

Edit to say get some mates to make even lower offers than yours first /later 

Edited May 20, 2017 by long time lurking

[long time lurking]

On 5/19/2017 at 2:02 PM, btd1981 said:

We moved back up to the Midlands and have put in offers for several houses. One was for 198k, for a house that had sat for about five months at 217k oiro. Rejected, but owner did say they would take 208. Didn't seem like an appropriate mark down given the list time, but then we had to eat our words when it went sstc to somebody else shortly after.

Also put in an offer for 200k for a house that had been on for the best part of a year at 230k. Agent told me they'd had no offers so thought why not. Rejected, and owner a bit put out apparently, but seriously? They bought it for less than half that about fifteen years ago.

Unfortunately the vendors hold all of the cards at this time, and are in no rush, so I wish you luck.

What did it sell for( LR price) you may have done someone a favor by helping to make the vendor realistic 

[long time lurking]

1 hour ago, janch said:

+1

It's worth making low offers because we usually don't know the seller's circumstances.  It could be they're desperate to sell as they're about to get repossessed etc etc  (or BTLers about to be made bankrupt).  Usually it won't work but you might strike lucky........at least that's what I'm hoping for.

It can also lower expectations 

[long time lurking]

22 hours ago, Grab_Some_Popcorn said:

Before we walked in the EA said to me "it's overpriced... the seller won't budge... Put in a silly offer"

 

Wow

That`s code for i`ve sold nowt in weeks help me out FFS

[btd1981]

16 minutes ago, long time lurking said:

What did it sell for( LR price) you may have done someone a favor by helping to make the vendor realistic 

We don't know yet, it's still in progress. Annoying thing is, with recent low volumes and subsequent kite flying, the house went from appearing to be very poor value at the original asking price, to total bargain in hindsight :/

[Kent Ambitions]

Low offers shouldn't be thrown around randomly. That is a recipe for annoying agents and vendors and achieving nothing.

You need to research the local market, look at land registry sold prices (£ per m3 in particular for comparable properties), and consider your and the vendors personal situations. If you are chain-free, or a cash buyer, that is obviously going to be attractive to a vendor. It's worth a discount on asking price. 

Then, when you make your low offer, do so in writing and arm yourself with stats, facts, and compliments (yes, compliments - this is someone's home, telling them you want 10% off the price because it's horribly decorated will just annoy them). It doesn't hurt to also attempt to tug on the heartstrings - i.e. I'm moving here to help look after my infirm parents (even if this isn't true). 

In my recent house hunt in Canterbury, I had two low-ish offer accepted by following the above advice. It works - but you need to make the case for WHY, not just throw a low figure at them and hope for the best.

[Quicksilver]

4 hours ago, John51 said:

I know a couple of guys that bought property that needed a lot of work. Consensus from them was that you need to have a good income because it WILL go well over budget getting it in shape.

I once worked with some Ugandan Asians. Amazing people. They came here with next to nothing and built a good life within a decade or so. 

No mortgages, it's all family money. Young guy is getting married, he borrows from every relative he can. His dad goes door knocking on every suitable house with a for sale sign. Low offer but if the vendor agrees now, contracts will be exchanged in less than a week.

One workmate was extra cheerful one Monday morning. Over the weekend, some cousins had repaid the £50 they each owed him. (This was 1980.) Thursday morning he looked miserable. His brother was getting married and was expecting a £500 loan from him.

 

 

 

I am a second gen Ugandan Asian and i don't recognize this world, maybe its diff in London but nobody in my family operates like this.

[“Nasty Piece of work”]

Offer the EA a Grand in cash on the quiet, if you get the house for under X.  Incentives work. 

[R1ch]

49 minutes ago, Sajid the Taxmeister said:

Offer the EA a Grand in cash on the quiet, if you get the house for under X.  Incentives work. 

Wouldn't that get you arrested? One way of getting a cheap roof over your head I suppose...

[TulipsFromThreadneedle]

1 hour ago, Sajid the Taxmeister said:

Offer the EA a Grand in cash on the quiet, if you get the house for under X.  Incentives work. 

Become an estate agent and undervalue a house.

http://www.express.co.uk/life-style/property/460557/Vulnerable-man-88-agreed-to-sell-1-8m-home-for-half-the-price

[mathschoc]

I offered 90k under asking price knowing full well it would be rejected, gave a list of reasons that I could find on viewing.

The next day it was reduced by 20k on rightmove. Offering under will plant a seed of doubt. 

[“Nasty Piece of work”]

1 hour ago, R1ch said:

Wouldn't that get you arrested? One way of getting a cheap roof over your head I suppose...

What charge?  

[R1ch]

2 minutes ago, Sajid the Taxmeister said:

What charge?  

Bribery?

[“Nasty Piece of work”]

13 minutes ago, R1ch said:

Bribery?

No.  

[R1ch]

8 minutes ago, Sajid the Taxmeister said:

No.  

Grey area, at best.

[Pop321]

Lots of advice here and an interesting thread. I have never been interested in an asking price only what it is worth. I have paid slightly over an asking price and 50% of an asking price. 

Some buyers just aren't worth entertaining with heads in the clouds....others are desperate. 

Know what it is worth. Offer that (or less). Ignore daft asking prices. ??

edit: did avoid making low offers if I know it would just pee EA off. And if something is fresh on...I would normal wait a few weeks first. 

Edited May 20, 2017 by Phil321