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How do you feel about sealed bids? Would it put you off at all?

50 replies

motherofallhangovers · 11/07/2012 16:10

If you were interested enough in a property to make an offer, and were then told there were others interested and it was going to go to sealed bids, would this put you off at all?

Have you ever been involved in a sealed bids process, as a vendor or buyer?

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sleeplessinderbyshire · 11/07/2012 16:14

I bought and sold both my last 2 houses via sealed bids - used to live in Sheffield where it is the standard way!

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SoupDragon · 11/07/2012 16:15

My current house was bought via sealed bids - it isn't the norm here. I can see the advantages of it but I would hate the fact that you have to make your mind up then and there with no negotiation.

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RCheshire · 11/07/2012 16:34

I put in a sealed bid a couple of months ago. No problem with it at all. At the end of the day just ignore it - from a buyer's perspective just offer what you're willing to pay.

Make sure you understand whether it's a formal or informal tender. Most are informal which means that even if a bid is accepted there is no real commitment from either side (surveys etc follow). If a formal tender then you are committed if you bid is accepted.

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Flatbread · 11/07/2012 16:52

We walked away from a house that went under sealed bids. However, if you do want to offer, make it an uneven amount, so £300,155.99 so you will more likely get it than someone who offers £300k.

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notsomanicnow · 11/07/2012 16:54

Did one as a seller, got about 10K over the asking price (£225 K). Sealed bids are meant to be in the buyer's interest - prevent a bidding war where the seller keeps going back to each buyer and using the other buyer's offer to ramp the price up.

I have to say though, it would put me off (as I would assume the property will go for over the 'value') - but then all the houses I'm looking at at the moment have been on the market 6 months plus, so I don't need to get involved in that kind of malarky. If I were looking in a fast moving market then I might welcome sealed bids, for the reasons above.

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Mintyy · 11/07/2012 16:57

Yes, I would be put off, because ime, people overpay for property through sealed bids. I suppose if I were filthy rich and not thinking of selling the house for another 20 or 30 years and I absolutely loved it, then I might consider it.

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Abzs · 11/07/2012 17:01

It's standard in Scotland. When Kirsty and Phil witter on about the Scottish system, this is what they mean.

I would definitely second Flatbread's uneven amount suggestion. We got our house by £26!

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motherofallhangovers · 11/07/2012 17:01

Sorry I should have said, we're the vendors, not the buyers. The EA suggested it might be an option.

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notsomanicnow · 11/07/2012 17:02

And if you do decide to take your property to sealed bids, I would avoid mentioning it to the viewers until at least second viewing, or at offer stage - slightly different situation but I mentioned to a viewer that we had received some (non-proceedable) offers and the feedback was that they felt they were too 'behind the game' (having only just got their house on the market) to compete, so they weren't interested in proceeding further.

I think competition does put some people off, so i would wait until they were really 'sold' on the house and were imagining their furniture in it, before telling them.

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motherofallhangovers · 11/07/2012 17:05

I was wondering if it might put a serious buyer off?

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WynkenBlynkenandNod · 11/07/2012 17:09

We walked away from a house that went to sealed bids. Made a good offer, over asking price. Agent said vendor was thinking of going to sealed bids. I said if he did, we wouldn't be bidding but I think agent thought we were playing games.

Found another house but had 4 phone calls asking if we would be putting our bid, one of them am hour past the deadline, despite me saying we had found and weren't interested.

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Levantine · 11/07/2012 17:12

It would put me off too if I knew it at the outset. If I had had a second viewing and really liked it I would do it though.

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Catsmamma · 11/07/2012 17:17

I would query whether or not there was actually that much interest in the house and I'd presume the vendors were game playing

unless of course it was a lovely gorgeous bargain house in a sought after locale.

but I would be a bit hmmmm about it, outside of Scotland.

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Levantine · 11/07/2012 17:18

I'm a bit dubious about them too. We didn't bother to put in a sealed bid on a house we had made an asking price offer on and had a phone call from the agent after the deadline asking if we still wanted to.

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motherofallhangovers · 11/07/2012 17:20

If someone makes a serious offer over the asking price it won't be going to sealed bids.

I'm not surprised you walked away!

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Viviennemary · 11/07/2012 17:20

Yes it would put me off. You could end up paying a lot more than the under bidder. Or lose the house which you wanted because you didn't bid enough.

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motherofallhangovers · 11/07/2012 17:21

It is in a fast-moving area. I'm sure the buyers are aware of that.

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motherofallhangovers · 11/07/2012 17:23

Sorry I'm not sure if that was clear - I mean I'm sure they'd know why we were doing it as there's a lot of demand round here. It's not for dubious reasons!

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Levantine · 11/07/2012 17:29

I sound as if I am contradicting myself - we didn't think it was worth more than the asking price, which we had already upped our offer to so walked away. If we had thought it was worth more and had really loved it we probably would have done it.

Whereabouts are you OP?

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motherofallhangovers · 11/07/2012 17:56

Hackney in London. Very fashionable all of a sudden!

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Mintyy · 11/07/2012 19:41

I think the answer to your question is that it would put some people off. But, as you live in a property hot spot, you may as well take people for a ride ...

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Levantine · 11/07/2012 20:27

Houses in London are shifting pretty fast ast the moment as far as I can see

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kensingtonkat · 11/07/2012 20:31

I loathe sealed bids processes. It makes me think the owner is going to be a twat further down the line, and the agent is a twat already.

A friend of mine is a property developer and is becoming expert at playing the game, though.

You put in a massive bid which you know is going to win. Greedy agent/vendor falls for it.

'Buyer' gets a bank valuation from the surveyor which downvalues it to a sensible amount.

Vendor is now mentally committed to the sale, and possibly in a chain by that point, so goes ahead anyway.

Or rejects the offer and goes to the underbidder.

Except the underbidder is a friend of the rejected buyer, and only wants to pay a sensible amount.

Fantastic.

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motherofallhangovers · 11/07/2012 20:45

"But, as you live in a property hot spot, you may as well take people for a ride"

I have absolutely no intention of taking people for a ride! Shock What makes you say that?!

A sealed bid process was presented to me as a good idea if there's lots of interest and actually fairer to buyers. Is it not so?

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Abzs · 11/07/2012 20:45

The only issue I have with the bids system is that I'd be worried about the state of the chain. As a buyer in this system you need to know that the vendor has somewhere to go. I think if we sell I'd be much happier selling, going into rented and then buying in case we were outbid (what we did when we moved up from Englandshire).

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