Bidding against an investor - any chance?

[Bol87]

We’ve found a house we love, it’s an extended into the roof bungalow in a fantastic area. It needs fully modernising and there’s potential to add another small extension on the downstairs to create a lovely big kitchen. It would make a delightful family home.

But the estate agent has told us we are up against an investor who has bought several of these bungalows in the area, done them up & sold them for a price that’d be over our budget. I’m feeling so disheartened. It’ll be the third property we’ve lost out on to an investor. We are after a property that needs a bit of work to modernise, we have a budget to extend but not the budget for a major project. But it just seems like investors snap these up & price is out of the area

Is there anything we can do to appeal to the seller? Or future sellers of these kinda houses? We have a property that’s sold, it’s a small chain. Or should we just give up looking for houses like this & buy something else!

If you love it put in an asking price offer. Have you sold your own property? Are you able to move quickly? Don't be put off by the estate agent.* Hope you get what you want.

• we once sold inadvertently to an investor who was in cahoots with the estate agent. I never found out until we'd exchanged and two days later a letter arrived from the local authority about a planning application put in by the 'family man' who bought our house. He wanted to demolish them (it was a reasonably sized plot) and build 2 houses in its place. There was absolutely nothing we could do as we'd exchanged. Never trust a developer further than you can throw him is my motto and estate agents aren't much better! Sorry for rant.

Surely the investor will want to pay the lowest amount for the property

Yes definitely ask the estate agent to make clear your position to the sellers. We’re in the process of selling Dad’s house and one of our stipulations was if possible we wanted to sell to somebody who was actually going to live there, not renovate / rent out.
Obviously as pp above say, sometimes buyers aren’t forthcoming with the truth 🤷🏻‍♀️

Personally I would far rather sell to a family than an investor - partly for sentimental reasons but also because someone who feels an emotional connection to the house is (imo) less likely to dick me around by eg gazundering.

Ultimately it would come down to the specific circumstances, but, for the reasons above, I would probably accept a lower offer from a family than I would from an investor. So don't give up just yet.

Investors have extra stamp duty to pay + buying and selling costs + refurb costs + profit margins to factor in so they need to buy at rock bottom prices. If your offers are below those levels then you’re mostly likely unrealistic about pricing.

Try and appeal to the seller. The house I have went to sealed bids. I offered the asking price and I know there were multiple other offers, although not sure if they were higher than me as estate agents won't tell. The man was selling because his mum had passed away. It was the house he grew up in and he wanted it to go to someone who would live there and love it. He was still friends with the neighbours a few years later and was really happy that it had become a family home again.

If this is going to be your family home, I don't understand why an investor would offer more than you. He is in it for profit, so it needs to be cheap enough to flip it. Don't listen to the estate agent. You could in an offer just below what you can afford. The agent will tip him off to go above. You then have wiggle room to increase your offer to your max but say it is only on the table for a day and on condition they take it off the market.

Good advice Diana

We just beat an investor to the house we are buying. They need to maximise profit, we don't. You can do it by paying a fair price, although you'll never feel like you got a deal!