Low offer on an overpriced house?

[Enjoythelittlethings5]

I'm a ftb and I've been trying to get on the property ladder for the last 3 years. I had an offer accepted on a house back in 2020 but it all fell through after 3 months as we soon discovered the house was unmortgageable. Then came the madness of 2021-2022 with house prices rising/bidding wars etc. I was outbid on a house and shortly gave up afterwards and decided to have a break. Things have now settled, prices slowly coming down and properties don't seem to be selling as quickly as they use to, although some sellers still have (in my opinion) unrealistic expectations.

I've had my eye on a house for the last couple of months. It was first listed at the beginning of May for £179,950, then reduced to £169,950 at the end of July which doesn't seem to have made a difference as it's still up for sale. I've checked and the house was first sold in 2006 for 110k then again in 2016 for the same price (inherited??)

It's a 2 bed bungalow with a driveway and back garden. Granted it looks as though you could move straight in (carpets and walls/paint look to be in good condition). It's had a new kitchen and bathroom since 2016 but I can't see anything else that's changed. I have no idea how much something like that would cost but the kitchen is small. It's currently empty. Houseprices.io estimated worth is £156,000, but I'm not sure how accurate that is.

I'm buying alone but I have good sized deposit and I earn a decent salary for a single person, however I don't want to overpay as I'd like to have some savings left over for a rainy day. I'd be comfortable with offering £135,000-£140,000 but is that too low??? On the other hand, is that a low offer when the house is clearly overpriced? I don't want to piss the vendor off but I wouldn't be comfortable or feel it would be sensible paying any more than that.

Obviously I don't know the vendors circumstances and they can only say no, but I just feel like I'm being cheeky with that figure for some reason. I don't want to waste anyone's time, including my own if this is a ridiculous idea. It would be great to your thoughts.

@UsingChangeofName I can't be the only that thinks that if it hasn't sold though. 4 months on the market is a while for the area.

Only one*

This!

"Overpriced" is - if I bought it for £xxxxxx, would I be able to sell it for £xxxxxx or thereabouts?

The house we're looking at - for quite specific reasons it is worth the asking price to us but we would never be able to sell it for that much if we changed our mind or it all went wrong for us. Therefore, it is far too risky to pay that much.

yeah just offer.

DS is into buying Lego on ebay. He offered £20 ("best offer") on an item he reckons should sell for about £100. The seller came back with a counter offer of £2000. We all think the seller is hilarious (genuinely). Nobody need feel offended.

Not sure that EA have to submit all offers by law..
Iv bought and sold many houses, and on occasions have asked agent not to pass me any offers under a certain amount.
I think by law , agent has to keep records of all offers submitted, but not all offers have to be passed to seller .

Estate agents must also treat buyers fairly. They must show any offers promptly and in writing to the person selling the house.
Estate agents are also legally obliged to pass on any other offers for the property right up to when contracts are exchanged.

It’s a tough market for sellers as so many buyers have lost borrowing power - you don’t know their circumstances so could get lucky

I’d say you have nothing to lose by going for it. If it’s been inherited they might just be thankful to get rid of it.

it’s definitely a buyers market at the moment and people are dropping by huge amounts or making very cheeky offers.

you could make the offer and if rejected say you can’t go any higher but are willing to keep the offer on the table. Also state your strong purchasing position. They might turn it down initially but then knowing they have a buyer there waiting might make them come back to you.

@Enjoythelittlethings5 if you're only comfortable offering 130-140k on a property, I'm not sure you should be looking at properties on at 170k. You've been trying to get on the property ladder for 3 years and have already lost a property you were outbid on. Maybe you are slightly unrealistic in your expectations if you haven't managed to buy in 3 years?

People will always encourage others to make ridiculously low offers on this site. But those that do never seem to get their offers accepted. It's true that a house is only worth what someone will pay. But it's also true that most sellers have a bottom line and below that, they won't sell apart from the few that are desperate. And those desperate for a quick sale may turn to an auction.

Naturally you could try offering 130k or 140k as there's nothing to stop you but what are the chances it will be accepted? Even 150k is unlikely to be accepted although that is where I would suggest it is reasonable to start. But think of it from the vendors point of view also. If they were able to accept 130k or 140k, don't you think they would have listed it at 150k to generate lots more interest?

Just to cover a question in your OP - an inherited property won't show as a sale in the land registry records. So that 2016 sale will have been a genuine sale, not someone inheriting it.

The fact it was sold for the same as the 2006 price isn't that surprising - many areas took a very long time to recover from the 2008 crash.

On the facts presented, the house does sound overpriced. A lot depends on their motivations to sell - they may not be bothered about making a sale anytime soon. I'd go in at around £140k and see what they say as it's been on the market a while.

Thanks @Twiglets1 . Definitely not unrealistic, I just wont overpay for a property, which I think is sensible especially in todays times. The previous house I was outbid on was only £140,000, but it was sold during 2022 when house prices went crazy and there were lots of bidding wars etc. I offered the asking price but other buyers offered over which I wasn't prepared to do. Funnily enough, that sale fell through and 3 months later the estate agents contacted me to see if I was still interested, however the mortgage rates had sky rocketed by that point and I wanted to take a break to see what happened with house prices.

Also, this was just an idea and probably the first house over my budget that I have looked at. I haven't even contacted the estate agents yet and I probably won't at this point. I think I'll wait and see if it's reduced again.

Personally offer what you think it's worth to you.
The worst that can happen? They say no.
No big deal, move on.

If you try a (too) low offer the EA may give a hint at what the minimum they might accept would be. You might not be far off and they have probably frightened off a lot of potential buyers by being too expensive.

Our neighbour listed far too high and accepted a much lower offer, we think even that was still too high for the amount of work needed, but the buyer was happy.

You need to offer a slightly higher figure I would go in at £143,700 -

Once rejected go and ask what they are realistically looking for they may come back with a couple get offer - then go half way between the two

Have a chat with the agent without submitting a formal offer. Ask them - say you think it is worth x, is it worth you offering? They will sometimes tell you about other offers which were rejected etc.

You can also politely ask the agent of the STC place what it is agreed at. If they don't want to tell you they won't.

When I've succeeded I've usually offered what I think it was worth plus 5k (on properties between 250 and 400). I suspect I undervalue.

Thanks @Totaly but I wouldn't go any higher than £140,000 (for various reasons)

Thanks @thelittlestkiwi a good idea to phone up and ask, as I certainly don't want to waste anyone's time.

I bought recently. My house was originally on the market for £850. It was never worth that and eventually they dropped the price to £790. I ended up getting it £785. At the end of the day, a house is only worth what someone's prepared to pay. Put the offer in and see what happens.

I'm looking at a probate property that is definitely overpriced for the area, condition, etc. If I decide to put in an offer, it'll be 10%-12% below asking. It's been on the market for 5 months with no recent interest, I'm surprised they haven't dropped their price already. Don't ask don't get.

None of the examples people are giving represent such a big percentage drop as @Enjoythelittlethings5 is hoping to get if they pay 140k maximum on a house listed at 170k.

Dropping 30k on a 170k is a huge amount, very different from a 10% drop of 30k on a 300k house say which I would consider fair enough.

They have nothing to lose with a phone call or even a viewing but my honest opinion is the difference is too big to do a deal.

@Twiglets1 do you think it would still be a cheeky offer if they dropped the price again in the near future, say by another 10k? Obviously I don't know if this will happen but clearly it's not selling at the price they want so the likelihood of that happening I would imagine is pretty high. There is another house on the same estate but a few streets down that was listed at £159,950 but they have accepted an offer of 140k (advert is still up)

I think the fact you're only comfortable to pay up to £140k means this isn't the house for you. From your own research online, it's valued in the high £150ks, so even if it's overpriced, it's not over by anywhere as much as you're able to pay - and that's really what your price is based on. You say a new kitchen and bathroom like it's minor but those are the main improvements most people want doing and they've been done so will have added value. As PPs say, no harm in a very cheeky offer in case they're desperate and can take the hit, but it's very unlikely, and you're better off looking at places on at 150 and under.

I think @thelittlestkiwi 's advice is good.

Have you actually seen the house? It might be worth viewing it and trying to strike up a rapport with the agent and see what the seller's position is, whether they have had other offers, etc. Assuming you like it, you can be frank and say that you wouldn't be prepared to pay more than x amount but don't want to waste anyone's time so won't offer formally at present.