Some thoughts on price, value, and low offers

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’A house is only worth what someone is prepared to pay for it’. I’m not sure that’s totally true. A house’s value is surely a combination of what someone is prepared to pay — and what the seller is prepared to sell it for. If a house is not as cheap as you would like it to be, it’s not necessarily that the seller is greedy or the house is over-priced: they just value it more than you do.

’It’s just a business/financial decision’. This one is definitely not true. Unless you’re dealing with investors, the sellers are selling their home, or the home of someone they loved who is no longer here. And you are buying your potential home. Of course there are a whole load of emotions caught up in it.

And that’s why people are insulted by ‘cheeky’ offers — you’re flat out telling them that the home they have created is a dump/ in bad taste/ worthless and that they’re either naive or greedy. Why not, instead of telling them that the house they are selling ‘overpriced’ and producing a list of things you think is wrong with it, say that you love it, really want to buy it, but can only afford to offer xxxx? I suspect that you would get a lot further with this softer approach than with the somewhat confrontational and dogmatic method that some seem to recommend.

Why not, instead of telling them that the house they are selling ‘overpriced’ and producing a list of things you think is wrong with it, say that you love it, really want to buy it, but can only afford to offer xxxx?

But what about when this isn't true?

In my experience, sellers can become very blinkered to the faults/issues with their home precisely because they’re emotionally invested in it.

Constructive feedback can be very useful to them if they're able to act upon it and rectify issues before the next potential buyer comes along.

That’s an unexpected level of altruism! I was thinking it would be a more successful approach to negotiations, if you actually want to buy the house.

lol!

There's a house near me that has been for sale since 2021!!! It's had reductions of 120k.
Some sellers are just deluded.

When we offered well below asking on a house in 2009 we just made it clear we were offering our max budget. Because we were. Admittedly we had factored in renovating it, but we didn't get into that.

The only downside to this approach is that you can't come back and offer more if they reject it - as then the 'top of our budget' thing is clearly bullshit. I had that as a seller many years earlier when a buyer came up with a v low offer followed by 3 successive 'best and final' offers. I told the estate agent I wasn't prepared to deal with them.

But in the end a house is only worth what someone will pay. It may be that today's offer is too low - but if noone offers a price that the vendor will accept, then it isn't worth the vendors valuation either.

A lot of sellers don't seem to have caught up with the idea that what they consider to be "cheeky" offers are what their houses are actually going to sell for after several months of messing about.

I agree, especially on the "it's just a business transaction" I can't imagine choosing my home based purely on £/sqft or risk losing somewhere I wanted to live for 20 years by lowballing or arguing over low thousands of pounds.

I hear it all the time on this board and I do wonder if it's just because it's an anonymous forum and therefore not something people would actually do in real life or because there really is a whole load of Oscar Wilde style "price of everything, value is nothing" cynics.

*value of nothing that should say

I've always thought this. My first house I paid about £5k over what I thought it was worth (due to dubious claims of another buyer from the estate agent) but I wasn't going to walk away over 5k (8 years ago) when the bottom line was that I wanted that house.

Maybe if buying a new build you could be a bit colder.

Why not, instead of telling them that the house they are selling ‘overpriced’ and producing a list of things you think is wrong with it, say that you love it, really want to buy it,

That’s exactly what a vendor wants to hear in a normal market and, I am sorry to say, makes the vendor feel they have power over the buyer.

It can lead to the buyer being walked all over or taken advantage of.

Sorry. Absolutely not. There are far too many manipulative sellers and EAs out there for me to allow them to believe I will stand for questionable behaviour, so why even let them think that in the first place?

but can only afford to offer xxxx?

Because, for me, that’s a lie. Generally I will be able to afford quite a lot more; we are currently looking quite a lot under our means. My offer is what I am prepared to pay for your house. My affordability is nobody’s business but mine.

I guess I am just not invested enough in bricks and mortar to have any emotional attachments.

Maybe if you gave me x3 my top budget I might find a dream home I simply couldn’t bear to be without. But that’s not real life for most people.

I’m talking about negotiating tactics in which each party thinks they’ve walked away with a ‘win’. Whether or not you could actually afford more is beside the point — it’s just a nicer way of saying that something is the maximum you will pay for that property. And I think that would be better than barely concealed hostility towards the sellers, which is what I’m getting from many posts!

I don’t play nice when it comes to one of the most stressful transactions in my life. I play honest, and I play fair, but also firm.

Perhaps that strategy gets people what they want, but that would be the polar opposite of my personality and I would find it incredibly hard to make that seem remotely genuine.

We offers 35K under asking - we liked the house, location was ok, size was good.

But there was no way I was paying more - £35K plus interest for 20 years is a lot of money. The lady was going into a home. She probably paid £5,000 for it c number of years ago. The only winners are the banks.

Why would you pay more than it’s worth?

Why not, instead of telling them that the house they are selling ‘overpriced’ and producing a list of things you think is wrong with it, say that you love it, really want to buy it,

I made this mistake as a FTB & was then gazumped. I was asked if I wanted to counter but I chose to walked away. I don't love any house enough to overpay on.

Why would you pay more than it’s worth?

Apparently it's polite the sellers!

most sellers aren't sincere. I mean they don't sincerely mean to sell. Is what I think. They are only looking to see what they can get & if they like that amount because of some other opportunity they might like to take. This makes buying difficult when people want you to engage in bidding wars or won't recognise they have listed in a falling market.

I'm not hostile about this, just trying to brace myself for encountering it (next year).

they only want to sell for the right price.
Meanwhile, buyers want a bargain, of course.

It's daft to get emotional if you don't like the price the other party wants to get/ max they will pay (either way).

You’d probably have been gazumped anyway, if there was someone willing to offer more. And walking away was the right thing to do if you didn’t want to counter offer.

That’s totally misunderstanding my argument.

I completely see your point, and I think you're right.

I've bought/sold many houses as property has been my business for twenty years. So I've experienced quite a bit, and always had a business approach.

But last year when buying for me, not as a development or a rental or a flip, I found a house I loved.

I didn't play games, I gave the vendor my best bid, and offered proof of funds along with my solicitor details and said I'd have a survey booked within the week.

I offered 10% below the guide price, with an assurance that this was going to be a much loved home.

They accepted, and we completed within 6 weeks.

If I'd have said 'I'm offering 10% lower because the windows have had it, the extension is a wee bit dodgy and your black-tile kitchen is hideous' then I think they'd have told me to fuck off.

I think putting negativity aside can be a huge benefit, you get more with honey and all that!

I think you can do both. You can make an offer and point out that you've based it on sale prices for comparable homes in the area, while at the same time emphasising that you would love to make it a home for your family. However that also relies on the seller being realistic about price and not scoffing that you are just trying to use sympathy to buy a house you otherwise "couldn't afford".

The thing about houses in the UK is that most of them are very similar. Quite often the only thing that differentiates an expensive house from a cheaper house is that one might be in a slightly better area. Unless you are prepared to live rurally or have a very high budget it's unlikely that you are buying a unique house and that you will never find something comparable if you miss out on a specific property.

That's something sellers are going to have to come to terms with as supply increases and buyers become pickier. There are a lot of houses that were only desirable in recent years because stock was low and buyers often didn't have time to even properly view before making an offer. I think the days of buying anything because you are afraid you are going to miss the boat are over.

I’m an agent in the algarve. I am up front with feedback from sellers and we work to see how things can be improved. Here, each area DOES have an approximate value per square metre. But also taking into account specific location, parking, facilities such as pools, new bathrooms, lifts etc. And negative things drop the price per square metre.