FTB - advice on offers?

[HestiaTheHearth]

Me and DH are planning on starting to look at properties properly from April, but we're having a look around now to get an idea of what's currently out there.

We were having a discussion earlier about what price range to look at. Our absolute top budget is likely to be £325, and there are a lot of properties in the range that are almost but not quite perfect. But if we look at properties in the £325-350 range there are some that tick every single box.

I think we should look at those with an eye to offering £325 (so less than 10% under the asking price), AFAIK the worst that can happen is they'll say no. Whereas if we only look at ones where we can afford the asking price, then we might be missing out.

DH thinks we should only bother looking at those definitely within budget, so as not to fall in love with properties and be upset when they say no. He also thinks it will be more upsetting to look at these perfect properties and then be disappointed when we have to settle for less.

We are FTB, so no direct experience of any of this, so not sure which of us is being more realistic.

Can I get some advice from those of you who have bought recently? Which method would you go for?

I would look at the higher bracket. Just don’t get your heart set on it if it turns out houses in your area are going for asking price or even higher.

As FTB you’re in a good position. Make yourself even more attractive as buyers by getting a mortgage AIP, having proof of your deposit and a GOOD solicitor at the ready.

Generally speaking, you're right, especially since you're a FTB - some people will be willing to accept a lower offer from an FTB over a higher offer from someone in a chain.

But use the time between now and April to keep a close eye on the kind of houses you're interested in and see how quickly they sell. If they're being snapped up quickly (10 days or less) then you're less likely to get away with a low offer and might need to revise your expectations.

I agree that it depends on the market.

I read on here a lot about it being usual to expect to pay max 10% below asking price. But in my experience the good estate agents local to me prefer to price competitively at the outset and then secure an asking price offer, or potentially a bit over asking price if there are a few serious offers on the table, within the first two weeks of going on the market. Appreciate not every area or individual property operates in the same way, but it's worth bearing in mind.

Additionally, I've found being a first time buyer is well regarded in the respect of not having a chain below them. However, there is also a perception that they can be spooked easily by a survey, and / or be quite fixated on relatively small but fiddly aspects such as whether there is a gas safety certificate for a ten year old cooker. So if you are going to go in with a lower offer as a first time buyer, I'd be thinking of how you can sell yourselves as being pragmatic to deal with in order to progress the sale.

Agree it totally depends on what the area is like. You may also benefit from a drop in property prices when the SDLT holiday ends in March, while being in the position of not needing to pay the tax yourself as first time buyers.

Just check you have enough cash to cover solictor's fees, mortgage fees etc.

With you being FTB and buying in April, I'm wondering whether there might also be an opportunity to open a lifetime ISA and bunging in the full allowed amount each, to benefit from the 25% top up from the government?

The problem with looking at higher bracket, is that the best houses often get competition and goto best and final offers. That is IF you area is very popular. ou could be still lucly as it depends who's competing (possibly all others in a chain etc). But you can't get too excited aboupt these, and be repared to wait a weel or two for theor decision if there aer many viewings.

In a quiet area or with lots of supply, by all means look at making offers 5-10% under asking.

sorry for missing letter an typos!

We’ve just bought a new house this month and on our area everything nice was going for over asking price, including the house we sold. It really depends on your area

Very much depends on the local market, but in theory you aren’t wrong

Perhaps look within your budget and the houses that are over your budget but which have been on the market for a month or more. See whether there are any that seem overpriced compared to similar properties that have been sold recently.

A decent estate agent may give you an indication if the seller is likely to accept an offer under the asking price.

If you are very targeted in your approach to properties over budget, you are more likely to be successful.

Whatever price bracket you look in, don't move in mentally until you know you are actually going to, in other words, when you exchange. The heartbreak of finding your perfect property, mentally living in it, your stuff in there, the decorating you will do, it is horrible to have that suddenly pulled out from underneath you when things go wrong. Stay emotionally detached at all times until you have got the keys in your hot little hands!

As others have said, entirely depends where you're looking. Houses round our way are going for asking or over. We had an offer accepted last October and went straight in at asking price, property had been on for 3 days. We had missed out on others because we tried to offer lower etc. But things might change once the stamp duty holiday is over. It can be fun to look over budget, but don't fall in love with anything or mentally move in!

Do pay attention to the market in your area. The 10% would be a complete nonsense in any of the areas I have ever bought and you would risk pissing vendors off and coming across as not serious. In the area I live at the moment 3% off is probably the most you could hope for and in reality 0.5-1.5% would be more likely. MN seems to have a weird demographic that believe no one ever pays asking price for a house.

The danger with viewing houses over your budget is that the ones that are in your price bracket then aren't on the same level.

When we were viewing we looked at everything in our price range and one £25k over budget. We obviously fell in love with the expensive one but they weren't willing to drop the price. In the end, we lost our buyer and managed to re sell for £10k over our first offer (asking price) and by this point the dream house had been on the market for 6 months so they accepted our offer of £15k under. In the 6 months in between I was in total despair though because I was feeling "meh" about every house comparing it to this one. Risky game but sometimes it can pay off.