Are people offering under asking price at the moment?

[Roastedcherries]

Just that really. We are chain free, have deposit ready to go so in a good buying position and the next place we buy will be our forever home so negative equity is not really a factor in my thinking. However I've noticed my local market very much slowing down (it was crazy a year ago, places going at 90 grand over asking) and places which I think are overpriced are hanging around for weeks if not months - this time last year places were marked as SSTC within 24 hours of going on rightmove. So I don't particularly want to offer at full asking in what I believe to be a falling market and just wondered what others experiences were as I don't want to piss off vendors unnecessarily. Say for instance something was priced at 675k and we went in at 650k, is that considered cheeky?

@Mark19735

But your point is irrelevant: the seller also needs to negotiate their next move based on the current market.

Meaning that if the market is flat - going down they need to negotiate their next purchase accordingly.

I think a lot of people need a reality check.

Rightmove has just released figures that the average asking price of newly listed property increased this month by £14, the lowest ever on record for the Jan -Feb period.

Many sellers are being more realistic and those who are not will not sale. It really is that simple.

It's not that rare for a seller to be in the first position.

Job moves, needing to move for school catchments, divorce, probate sales etc... all of those are scenarios where the seller definitely wants/needs to sell, and the only question is what price they will achieve.

'No seller is ever deluded'
They are deluded if they think they are going to sell their home for a price well over current market value.
Equally, a potential buyer viewing all the local houses and continually offering 25% under asking would also be called deluded if they think they were going to buy a house at that price.

Lots of sellers need to sell for a large variety of reasons. They may not need to sell rapidly but they will need to sell within whatever their personal time period is and sometimes that can escalate as a result of changed circumstances.
On the other hand, most buyers don't 'need' to buy. They can stay where they are/ rent, etc. At the moment, lots of buyers, especially FTB can't afford to buy so those houses that they may have bought are simply not being bought.

That's been the case for the last decade though. Austerity for public services while the home owning classes get assistance to buy assets
Assistance which further inflates the price of the asset, this means that a basic human need, a stable affordable place to live... Is increasingly out of reach for normal people ☹️

We've just offered on a place and were accepted - 50k under asking price. The same place was sold for 40k ABOVE asking price in June of last year and the chain fell through right before exchange as the vendors buyers lost their own FTBs due to rising interest rates and then couldn't resell.

There will also be people who need to sell because rising interest rates have made their mortgages unaffordable

I recently had an offer of 98% of sales price accepted on a purchase of 600K. I did start at less than that but it’s a house I really really want and I have done my calculations. It’s in a popular area but I believe was sensibly priced in the current market. I am not a FTB so have a healthy deposit and am currently in rented so I am happy to pay that for it. I can imagine I will be in the house for a good ten years or more so to me it was worth it even if there are further falls. For me it all depends on what your own needs and circumstances are. Also I calculated spending another however many months paying £1700 a month rent and factored that in! I would rather my money went on my own mortgage than someone else’s.

Unexpectedly we are now viewing something that has just failed to sell at auction. It has been extended and they haven’t finished as I think sadly one of them died unexpectedly.

It’s offers in excess of 400k, great location. Weird layout that will suit us brilliantly but I think would put most off and I think the garden is small for size of house plus a fair bit of work to do but liveable. We would need small mortgage and have an agreement in principle. Allegedly someone viewing just before it. If we like it what would you all offer? My apologies to @Roastedcherries for asking on her thread.

Can you find out anyhow what was the minimum amount the vendors said they would sell for at auction?
If you can’t find out that amount, I would start at 360k and see what they say. Unlikely to accept if they want offers offer 400k but it’s a good solid start to negotiations.

I think at auction they can’t list it less than 10% below minimum?
So on at 400 means they want 440?

As it failed to sell, they have had a dose of price discovery, I’d be very careful not to buy a lemon that no one else wanted.

Start at 400, but as a pp said the reserve was probably 440

There's no shortage of delusion, that's for sure - but I'm still not convinced it's all on the sell side!

All the scenarios listed by the PPs are still all scenario 2 - yes, people want to sell to achieve a life goal (school catchment, job relocation, bigger house, retirement etc. etc.) but they will only want to sell if the price they achieve enables them to realise that life goal - in other words, if the sale price meets their minimum price expectations.

And even in the event where someone is falling short, month on month, due to higher mortgage repayments or straitened circumstances - they will still need somewhere to live, and remaining in the house they have already bought is usually cheaper than selling up and renting/buying somewhere else. Knocking 10% off the asking price of a house you paid £600k for costs £60,000 now, in today's money. That's the equivalent to absorbing a £500 per month mortgage shortfall every single month for the next ten years. Eventually the money will run out, for sure, but before that happens they'll cling to any strategy that kicks that can down the road. Taking a mortgage holiday. Taking in a lodger. Working a second job. Selling the car/furniture/heirlooms. Delaying retirement and extending the term of the mortgage. Anything to avoid crystallising that loss. I think anyone expecting to pick up a house for less than the current owner paid for it is in for a long, long wait.

Do you know what the last bid was?

The vendor has just had a kick in the balls regarding their expected price.
Failing to sell via estate agent and now at auction means their expectations are too high.
No one wants that house at that price.

Another thing that I keep hearing as a buyer (I was a seller recently as well by the way so I have nothing against sellers per se...) is:

Agent: ''Well, they won't consider a lower offer because they had an offer close to asking price''
Me: ''Ok, why is it still on the market then?''
Agent: ''Because the potential buyer made the offer lost their buyer who could not get a mortgage, so they haven't sold their house. yet''
Me: ''so they don't have a proceedable offer then and the property hasn't sold for over X months already''
Agent: ''yeah but they had an offer close to asking price...''

And on and on it goes.

Quite a common story at the moment: buyers make offers they can't really deliver on and sellers convince themselves as a result that this is a sign they can hold for asking price.

Meanwhile the property is still on the market after several months and people think there is potentially something wrong with it/that the owners are unreasonable.

Yes! This exactly.

Me: "The house has been on the market for over 3 months, which suggests to us that the asking price is optimistic."
Agent: "Well actually we've had a lot of interest, it's just no-one else is proceedable."
Me: "Right."

Thank you all, very helpful as I know nothing about auctions! I think the guide price was 400k then 2 days before they reduced that to 380k. As soon as it failed to sell it went on at offers over 400k on agents normal site.

It won’t appeal to many as it is but would work well for us . Hard to tell without seeing it inside exactly how much work is needed though. Will see what tomorrow brings and have booked a viewing on something else too.

It went straight to auction rather than going on agent’s site . I did see it but wasn’t interested in going to auction .

I've just accepted an offer of asking price. Amazing.

Am now tangled up in a race for the house I want which I offered the guide price for 2 weeks ago, but I think two other people have as well. Just depends how proceedable we are.

Totally agree @LookingOldTheseDays
It's wrong on lots of levels but people do carry on voting for it. I had been hoping that pumping the housing market was becoming less palatable but perhaps that was wishful thinking!

@Greenfairydust and @Watermelonsugar1 -it sounds as if some estate agents are very unrealistic too. I would have thought they would want to earn their commission!
The EA here seem to been getting a lot less sales completed here, really a lot less and that is going to impact them hugely.

Just to answer the title of the thread, and for general information- I went to see a property today and was told an offer had been made "under asking". So people clearly are offering under asking.

The property wasn't for me, so it sounds like the sellers will accept the under asking offer, as they want (need?) a quick move.

I am going to withdraw my offer of 10K under asking price as the owner has now been ''thinking about it'' for 4 days.

I initially offered £15k under (5% under the asking price) and I thought even that was generous.

I think this is another issue in the current market: it is very easy to get cold feet and if you feel you are being pushed to the limit by sellers and suspect you are overpaying.

I would have definitely gone ahead if my 5% under offer had been accepted straight away but now another potential property sale is going to bite the dust.

I am always concerned as well that sellers who take too long to accept offers will take the first opportunity to gazump...

We're in north Leeds @rainingsnoring

Thank you! I thought you might be in that sort of area. Manchester/ Sheffield/Leeds areas still seem to be relatively fast moving compared to most of the rest of the country which started falling months ago.

@Greenfairydust any sensible seller who actually wants to sell would move as quickly as possible through the process in the current market imo. I expect some will come to regret holding out for another 10K when they find that their house is worth even less in 6 months.