What to bid

[InstantKarnage]

Hi all, seeking your thoughts on a property conundrum and where to start bidding. We're looking at a fairly niche property on the market at £975k, it’s been on for 4 months, and no offers. The property is a standout for us - the nicest we've seen - but the area isn't our top choice. We're a bit uncertain about what to offer - nothing similar has sold recently in the area. DH thinks it’s offensive to offer anything beginning with an 8. I’m not sure. What would consider offensive here, what would you consider cheeky, and what would you consider reasonable or at least borderline? Not looking for a valuation on the property, as I say it’s fairly niche so difficult to value. But if it were your property, and you believed it to be “worth” £975k - what would you be offended to be offered! We’re trying not to alienate the seller, but also trying to find the market. We said to the estate agent that we’re worried about the lack of offers, that we don’t know the market without other bidders. We would like to make a low offer to see if we can get some idea of where others see it. We don’t want to be the only bidder and start (and finish too high). Any thoughts please?

Yes @Alexalee it does seem better psychologically alright - I will take the advice of people here. Good to get people’s thoughts. I will go with 900. I will report back at some stage to say how it went.

I still think you showed all the cards in your hand. IMO you said wayyyy too much.

Yes maybe so - we haven’t don’t this for a long time so we’re a bit amateur hour 😬

Just a heads up to really think about the property.
We have a cottage near us up for sale - it's unique, unusual etc but basically at the end of the day when you are trying to live in it, it's a very small three bed, in very poor condition near a noisy road.

The owners adore it, worked really hard 20 years ago but spent little. They want 700k it wasn't worth that 18months ago, it's not worth that now. It's actually worth about 400k probably 300k plus money to do a back to brick internals, new fencing, new outbuildings. Then I imagine it would sell for 500k tops because it's pokey with low ceilings and an awkward orientation.

It's very expensive just to full in love with the pretty bench and a greenhouse.

on for 4 months, and no offers

How does OP know that (no offers part, especially), is it ethical for EA to tell OP that?

I would assume they are in no rush to sell if they haven't lowered already, so they will ignore a truly lowball offer.

I can't understand being "offended" by a low offer, so can't help you there.

Only pay what you think you can afford. If you think it would only fetch £875k in today's money from any other buyer, then stick with that as your ceiling.

Why the whole game playing? Why does it matter what other people think its worth "to find the market" or however you phrase it - its worth £925k to you. Offer that, tell the EA that's what you value it at and its not a starting point for negotiation - its your best and final offer. If its not accepted, and you don't think its worth any more, walk away. I don't understand the whole "make a really low offer, potentially alienate the seller even though we always expected to pay more" mentality.

The point is that by offering 900k and negotiating, @InstantKarnage could potentially end up getting it for less than 925k.

Even if they ended up “only” paying 920k say, isn’t it worth a few days of wrangling to potentially gain 5k. It’s a lot of money!

@lljkk - I asked about offers and they told me there are no offers. I know it doesn’t mean there haven’t been offers that were rejected, or that have been withdrawn. The EA didn’t give the impression that there were any offers, even lowball ones. He was keen to state that it was a niche property and they can take a while to find the right buyer.

@Africa2go it matters to us as we will have to sell it at some stage. My health isn’t great which is driving the move and I hope we will be here for 10 years, but it could be that DH has to sell up in 5 years or less. So we would like to know there’s a market for the property and don’t want to overpay and take a loss if it has to be sold in a few years.

@Twiglets1 - exactly! We’ve a lot of expenses in addition to the moving and 5k, or 10k or 25k would be huge - it would fund the cost to change our car for example, which is well overdue.

@Twiglets well, I'd beg to differ that £5k on a house the OP thinks is worth £925k isn't "a lot of money" to her, but I accept that they may save a few grand by playing games.

Equally though, they might be (a) at best, wasting everyone's time because (despite what the EA says) there have probably been (low) offers that have been rejected and this will probably happen again or (b) the seller might refuse to deal with the OP from the outset if they have them pegged as a game player (so they lose the house even though they'd have paid more).

Just think you should be straight - go with what you think its worth and would be happy to pay. Would the OP be more upset at potentially having "lost" a saving of £5k by going in at £925k (rather than going in low and negotiating up to £920k) and the £925k being accepted with good will on both sides, or going in at £875k/£900k and the seller thinking they're playing games?

Go in with €905, supported with some reasons for the decrease, call out work that has to be done, how they benefit with cash buyer, willingness to move quickly. When they come back with a probable no, ask them what they are willing to accept, and play a bit of a waiting game. Let them sit for a week and make it seem like they might lose you as a buyer then off £10k under their counter offer if it's below £950. £20k if it's above £950 and then you might get to point if splitting the difference.

I think when you’re talking about large sums of money as people do with house buying it’s easy to feel like it’s almost Monopoly money and £5k or so isn’t that significant in the great scheme of things. But it is! Outside of the house purchase people would work hard to gain 5k and would consider it a huge amount of money to lose.

I bought a place for 880 that was on a 1.1 so bollocks to the “offensive” 8 nonsense.

A cash chain free buyer is far more valuable than a mortgage/chain offer particularly as the buyers NTS.

Forget about what it’s worth to you. Work out the average £ per sq foot of the road and general area; factor in that its niche quality will make it harder to sell; and the fact that it’s got 0 offers after 4 months.

You’re in a very strong position. Start with a lowball offer.

By which I mean lower than 900k.

There was a thread on here, "would you sell for less to a buyer who was cash only" and almost unaminous answer was "NO!!!" Some even said they would assume all cash buyers were developers who will gazunder and mess you about.

I have been chain-free buyer both times, cash 2nd time, in different places, & never perceived that we had any buyer power advantage for those attributes.

That’s a reflection of the inexperience of many posters at buying/selling properties.

They’re simply answering a hypothetical situation in which they wouldn’t want their house to go for less than they think it’s worth.

But the reality is a clean offer is more valuable. A freehold be processed by a good solicitor in 2-4 weeks. Chains can fall apart very easily, a mortgage can be declined. A bird in the hand etc.

I don’t think most people would consider a cash offer to be £100k more valuable, though. They may consider a slightly lower cash offer if it was in competition with other offers that were part of chains, but I don’t believe four months is long enough on the market for the sellers to entertain a really low ball offer.

4 months and no offers is plenty of time to lowball. It can be the starting point for a negotiation.

Niche properties are very difficult to value for the agents as there are no comps - different agents may have very different views - ultimately it’s worth what someone is willing to pay for it. No-one is willing to pay 975.

The owners have probably accepted now that they are unlikely to achieve 975k.

Doesn't mean they would consider 875k or similar. Before even thinking about that the logical thing would be for them to reduce their asking price to 925k. That would probably stimulate some new interest which @InstantKarnage doesn't want to happen.

10% under the ask is perfectly reasonable place to start negotiation with no offer on the table.

If you weren’t fussed about getting the house, which the OP is. What she’s concerned about is the risk of pissing off the sellers with an offer so low that they will refuse to negotiate.

Sellers just refuse offers they’re not interested in or negotiate. The agent act as go between and they can work out a price agreeable to both.

I’ve never been offended by a low offer. An offer is an offer, you can either get the buyer up or you can’t.

This is not rocket science!

I know. I am selling a house now. And I have sold in the past. Some offers are clearly within a negotiable range. Some aren’t. And I know from experience that it’s simply not worth painfully and slowly trying to bridge too big a gap because the buyer will invariably pull out because they have in fact allowed themselves to be talked above their comfort level. I wouldn’t bother again.

It’s not rocket science. It’s more ambiguous and nuanced.