Offering below asking price on property just added to market

[dzungf5]

I'm looking to purchase property as FTB and feel a bit clueless with offering under/over asking price.

Locally there has been quite a few properties the style i'm looking for coming on market over past few months, some sell within matter of days, others are not selling after month or two. There generally hasn't been any price reductions on listing prices yet.

I've viewed a few and made offers on two.

The two i made offers on, i viewed within a few days of them going on the market.

One, i made first offer 3% below asking, then increased to 1% over asking, they ended up going with cash buyer over asking, it was sold within a few days of been on market.

Other i offered exactly OIRO value and Vendor didn't accept as they were looking for extra 10k over that price.

I am due to view a property this weekend which looks ideal, it only got added this week, agent says there has been lots of interest. I can afford the asking price but would rather not go over. If i was to make an offer following the viewing would you start lower than asking or go straight in with asking price? Everyone i've spoken to says start 5% below asking, but these people either bought years ago, buying larger family houses, homes which needed work doing, properties which had been on market long time or owners desperate to move. I don't want to appear cheeky starting too low, when there potential may be other offers straight in at asking.

It’s really difficult to advise. There are no hard and fast rules in any market really, and especially not in this one.

A lot depends on where you are and how hot it is for the types of property you are looking at. It sounds quite hot.

The number one rule is do not end up paying more than you can afford.

If you end up with the sneaking feeling that you could have got away with paying less, that does not matter as long as you are within your zone of affordability.

If you keep losing out because others offer more than you can afford, so be it.

I think you need to fix on your ‘no regrets’ price and just offer that as your best and final offer. If you lose out, move on to the next.

Sounds like it's a popular area with vendors having no problem finding sellers even in these tricky times. That will hopefully be good for you once you have a place. Normally I'd advise going in under market just because. In this instance I think that would look like you didn't know the local market. In your place I'd offer asking price. You may not want to offer over but you might have to, if you can afford it. Good luck

Is this your dream house? Is it possibly likely that there will be other houses that fit your criteria? Are you able to take your time in choosing? In other words do you need to buy right now? Is the price reasonable? All the above may impact on your offer. How would you feel if you didn’t get this house? Any house that is on a nice street, good neighbourhood, near good schools, transport links, amenities etc and priced correctly will always sell quickly.
i think it’s a good policy to buy a house that appeals to a wide market so you can sell on easily if need be.

I think judging by your examples of properties you’ve lost it’s obviously not an area where sales are slowing. With that in mind I think I would offer asking if I loved it, with the caveat mentioned by the previous poster of only if I could afford it

I think offer what you can afford and think the house is worth. You can go back after the survey if there are any major issues that come up, I negotiated some work to be completed before purchase on my property following the survey. I'm not sure about offering under on principle, though it depends on what the market is like where you are.

Given that the other two properties you offered on when over their asking price I think if I were you I'd go all in with this one.
Can you afford to go slightly above the asking? I'd be tempted to go ever so slightly over asking (if i could afford) with a one off offer.
Say this is my offer £xxxxx it is offered on condition the house is withdrawn from the market and is the highest offer I can make (and mean it) Then you will avoid getting in a bidding war (hopefully)

Good Luck

Just offer what it is worth to you and what you can afford, no more, no less.

You will be unlikely to be able to deal hard on a property that has just been placed on the market because the sellers with think there is a chance someone will come along who will pay full price or even more.

It normally takes a long time on the market with little interest for sellers to realise they have their pricing wrong and be willing to discount.

Also do not believe what agents tell you.

In your case I would offer the asking price, emphasizing that you are in a great position to proceed and it's a first and final offer.

In 2020 we moved last- we offered asking price and were on the first viewing day. We could afford it- it was worth it, my DH wanted to offer just below, but I felt he was just wanting to feel he had had a slight bargain- which I think wouldn't have worked. We offered full asking price, had a sale secured on our first house, but said we wanted it brought straight off the market with our offer if they accepted. I think going in a tiny amount below seems risky if it's a house that's going to be snapped up. Good luck

I think you have to go based on the house and how much you want it.
I think in the UK we're so set on trying to get a deal that often we risk losing out!
If you offer below asking, and you find out someone offered asking and got it - would you be disappointed that you hadn't just offered asking?? If so then offer asking! Doesn't sound like your property market is slowing

Thanks for all the useful advice

I'm not in any rush to move and there does seem to be plenty of suitable options coming on market which meet needs so i wouldn't be too disheartened if i didn't get it.

I think i'll be prepared to go in at asking price but not stretch myself over knowing something else suitable might come on market

When my son bought ( made offer last year - got the keys a month ago )
He offered 5k less while in the viewing
he was the first viewer to view and luckily for him the owners were in the house as he viewed
So he was able to chat to them a bit about his situation.

The buyers accepted his offer and the other viewing were cancelled 😂

But he was a FTB
ready to go with a MIP and a big deposit and had just had a sell fall through due to a lease issue so they were pretty sure no problem with a mortgage

I told him to offer 5k less but be prepared to go to asking if it’s what he really wants and the house ticked every single box

If you genuinely want it then go in at asking price... don't play silly games over a few thousand.

There is no other thing where you see the listed sale price and say 'actually I'll give you 5% less' is there? imagine trying that in Asda with Bananas lol.

You are my type of agent! A “no regrets” offer is the only one you should be fixated on.

ask the agent what their offer process is ie will their be a chance to submit best and final offers once you make your initial offer? Every agent and client is different.

despite what the media says, some parts of the market are really active with lots of buyers.

good luck x

Based on what has happened with the other 2 comparable properties you offered on, the market is strong in your particular area for those sort of properties.

If you can afford it and the property seems worth it after viewing, I would offer the asking price on the proviso that it is taken off the market immediately.

Just to add, I wouldn’t underestimate the value you bring as a FTB too. No chain is a huge appeal to most sellers. I’d offer a little under asking and see how you get on (unless it is literally your dream home and you don’t wanna risk losing it, in which case if you’re happy it’s worth the asking price then just go for it rather than playing games)

OP, I’ve recently bought and sold and had several offers quite quickly, so can perhaps give vendors perspective.

If they’ve just listed and had lots of interest, and you can afford it / think asking price is reasonable - I would offer asking. If they get other similar offers straightaway (and they may delay a few days to see if any other viewings generate offers) they may decide to go to best and final offers, in which case you can go over if you want to. But at this stage I think it’s unnecessary to offer over asking - by offering asking price you show you’re serious from the get go. Good luck!

(By the way, I don’t agree that being a FTB is necessarily seen as an advantage - they are often considered tricky to deal with and increasingly lots of other types of buyer are also chain free and often cash)

Depends how much you want the house. The seller is likely to want to get as much as they can from it. You can offer what you like, but if the seller thinks they will be able to get a better offer, they will likely not accept your offer. If you really want the house, offer the asking price and see if you get accepted, or even offer a little over asking price. If you aren't too bothered offer what you want to pay, and if the sellers get a higher offer and go with that it's ok.

We have recently bought a house. We made offers on 2 houses, both we offered way under asking price because I was advised by my in laws that buyers marketed the house allowing for a lower offer being made.

We didn't find this the case with the two we offered on though, neither would accept anything under asking price but both were willing to sell at asking price.

There's no harm in offering lower, we made some cheeky offers but I just figured if you dont ask you dont get. Maybe they really want to sell quickly.

As a pp said, have a limit you won't go over and just build the price up to that point.

Actually many people are switching to avoiding FTB... yes chain free is good but many are slow, unknowledgeable, demanding and a bit deluded. They are far more flakey and likely to pull out or gunzunder the seller.

Many sellers are avoiding that now.

unknowledgeable, demanding and a bit deluded

You took the words from my mouth. Had a FTB visit my property and advised me on how to restructure my property and then what price I should try to sell it for in an email to my EA. The EA had given them the full details of the property and still they decided to visit and offer unsolicited advice.

I think it’s really hard to advise. By now you probably have a good idea of the going rate in your area, so you will have a good idea whether the one you have found is a reasonable asking price.
When we sold our house we got 6 offers (3 over asking price) so obviously we didn’t even consider those under asking.

Work out the price per square foot for your area. Take into account location, noise, detached/terrace etc, garage, garden, 'extras' and you can get to a good estimate of the value.