How to make a cheeky offer without alienating seller/EA?

[User7164]

Hello!

We are first time buyers and have been house searching for the last year or so. Recently found a house we love, good area for raising our little one schools nearby and a quiet cul de sac. The house is listed for £450K and has been on the market for >5 months.

The average selling price in the street is quite high with a few (bigger houses with bigger gardens) going for 450-500k, but we feel for the size and garden size of this one, and the money we’d need to invest in replacing all bathrooms and upgrading kitchen (and perhaps an extension) that it’s not worth 450. In all honestly, I think it’s around 100k overpriced.

We think our absolute max that we believe the house Is worth would be 400k. We want to go in with a low offer, but I’m cautious as the last time we offered 15% below on a house we liked the EA basically cut us off. I don’t want to offend the seller at all because they were so lovely!!

Any tips on how to go into this? Thanks!

1-2K?

When did you last redecorate? DH and I just redecorated a 2 bed flat and the paint and prep materials alone came to around £500. But you're mentioning new flooring and worktops. That's probably several grand.

This tool is interesting but a bit strange.

We bought in Q4 2019 for £343k. If I use that figure, our house is now worth £425k (28% increase).

We tried to sell in Q2 2022 and it was valued at £380k. If I input that in the tool, our house is apparently now worth £365k (3% less than in 2022).

So I wouldn't say it was particularly accurate.

No knowing the area but property prices have generally gone up since 2019, albeit they've dropped a little in the last 12 months or so. It is therefore probably irrelevant that they are listing it for about 100k more than they paid with little investment.

Notwithstanding that, as others have said try having open conversations with the Ea as to what you can afford without slating the property completely. Going in at 400k might get laughed out the park but you could get a feeling fow a number as to what they would drop to. You can always negotiate up but it's far more tricky to negotiate down.

Both times we have bought we have out in offers of what we thought was acceptable. The first one was on at £425k and we offered £400k. The second was £650k and we offered £610k.

At the time the first was all we could afford, it had been on for 6 months and they had already declined the same offer but hadn't had another one since and knew they wanted to sell to move away to be closer to family. The second was over priced (EA agreed) but they had done a lot of work so wanted to get back as much as possible. On both occasions we didn't mess around, just said what our top offer was. Both times they declined and asked us to up our price, we didn't and said it was the max we could go and the offers were then accepted. I think it's better to be honest from the start and tell the EA what your highest offer is. No messing around and they know you're being honest. Good luck.

The tool does have the usual caveats about it’s just a guide and takes no account of the condition of the property etc. So I agree it’s probably not particularly accurate but more a very rough guide to what has happened generally to prices over the years depending on your postcode.

I don’t understand why sellers get so precious about their house. You don’t want it any more, hence listing it to sell so why get offended at what someone else thinks it’s worth to them?

Our house is on the market and I don’t care if someone makes a lowball offer. I certainly wouldn’t waste time getting upset over it 😂. It’s dead easy to say no.

A property is worth what the buyer and seller agree, it’s got feck all to do with the estate agent, who is there to guide only

Put the offer in. you dont need to elaborate on why you are offering that only saying it is what you are willing to pay. Put it in writing not by phone.

Have your finances in place and a solicitor ready and include this in your email offer.

put a time limit on it such as 5 working days and also say this is your offer, not your opening offer

Looking at how much they paid for the house is pointless, their onward purchase will likely have increased in value at a similar rate. They may be happy to sell if they've been on the market a while, or they may not be able to move for less than a certain figure. Give them a genuine fair offer and they can either accept or decline.

I would say though as the wife of a builder, if you genuinely need to extend maybe get some idea of how much that will cost. We intended to extend our current house but due to the rising cost of building materials it is cheaper to move.

@fatandhappy47

rubbidh. As the buyer, it's only worth what they're prepared to pay. The seller can choose to accept or not.

If the house hasn't sold in the last 5 mo then there is no market for it at the price its being offered at.

This is a really useful video for buyers right now.

The only thing you should be looking at is comps. Look at the street and surrounding streets for similar houses and get a feel for what they have sold for in the last year. It's irrelevant what it sold for four years ago. 'Updating' is relative - I wouldn't reduce an offer because I don't like the carpets or the kitchen style. If there's actual issues like damp or roof repairs that's something else.
But it has been on the market a while. So I think it's fine going in as suggested above around £405k. Say your budget is being stretched but you really like the house. Your budget may include your planned upgrades, but they don't need to know that.

We got an offer 12% under asking, on a £1m + property in London. We didn’t even respond/counter their offer. They were first time buyers too and spent 45min on a viewing, sending us a very long list of things they needed to improve/change to their liking. It all did feel a bit insulting even though we REALLY wanted to sell and didn’t like our area.
We had then accepted an offer 25k under asking a few weeks later from a serious couple.

Also worth bearing in mind that the owners may not be in a hurry to sell. 5 months isn't that long for a property to be on the market and includes the Xmas period when people are perhaps less likely to go house-hunting. If they're in no hurry and the estate agent has recommended an asking price of £450k then they may well be happy to bide their time.

I'd be pissed off to be honest if I was asking £450k and you offered £390k.

The issue here is that what you are asking is irrelevant. Asking prices are just a flag to tell people that you are considering selling. The market will determine what you will be paid. You then get to choose whether or not to accept.

A sensible approach and @oiltrader's.
There are always lots of sellers projecting their own personal experience on these threads. They are irrelevant to this situation, as they were marketing at different times, in different markets. The fact is that this house hasn't sold in 5 months so it is overpriced. If a seller chooses to take offence at an offer, that is a v foolish reaction which doesn't help their situation at all. All they need to do is accept/ decline or counter offer. If you put in your max bid first time, simply stick with this figure. Or, speak to the agent as I suggested earlier and try to gage the seller's situation and whether or not it is worth putting in a lower offer. The main thing is to do your research properly first.

@XVGN - well that's my point. If owners are desperate to sell they will take a lower offer. If they're not they won't!

They are probably wasting their time and just losing more money in a falling market by 'biding their time' but that is their choice, obviously.
If they haven't had an AP offer in 5 months, the chances of them receiving one now are remote.

I don’t think 5 months is that long to be on the market really. I’ve a lovely friend who has recently been looking to buy a property as going through a divorce.

She has a very similar perspective to yours; she’s been very quick to point out why she doesn’t think lovely houses in good areas are worth what they are asking.

She’s looked for over a year, and has missed out on three gorgeous properties because in her opinion, they are “not worth what the seller is asking”. She low balled and was rejected, and by the time she pushed her offer up, another buyer had snapped them up (very likely asking price or close to!).

She’s now in the position of having consider a house that’s not really what she wanted.

@rainingsnoring - I'm not sure many sellers expect to get AP (though we offered £680 on our current home, marketed at £700 and the seller said no so we paid full AP). But I wouldn't expect sellers to be interested in negotiating at £390 on a property marketed at £450 - unless of course they're desperate to move.

That is true but I was making a different point about biding their time.
This worked very well when prices were rising several % a yr but is much, much likely to be successful now. Obviously, it depends on the area, etc but in this case, the property hasn't exactly been snapped up!

The property hasn't been snapped up but nor has it been on the market for months on end. It's 5 months which isn't that unusual in this sort of market. Nevertheless, they should be keen to do a deal by now which is why I suggest going in low at 400k though you would be lucky to get it at that price.

@rainingsnoring i am literally in a process of selling my house right now.

Have you made an excel spreadsheet/some other method to analyse the price per square metre of recently sold properties? That might give you a more scientific view on whether this one is well priced. Maybe just a London thing but generally it’s a fairly clear formula of price per square metre around here, with variations around the average based on how nicely renovated they are, or size of garden etc.

Then maybe instead of plucking £400 from thin air, you can say you’ve offered £x which translates to £x,xxx per square metre which is the street average.