How should negotiate on property purchase?

[foursquares]

Hi. First time buyer, appreciate some advice.

Saw a property we like, listed for £450k. It's been on the market just under 3 months. It's had one offer in first week, which was rejected by seller - I don't know amount.

We've recently offered £423k (6% under asking), which was rejected. According to agenct, seller looking for close to asking price.

Given that it's been on for a while, we're in a buyers market, and heading into post-summer period...couple of queries :

1. The asking price is overpriced right?
2. How should I approach negotiations?

Thanks in advance.

Why?

Ah, you must be one of those very important people with a special phone that allows you to read what you want rather than the rest of us normal users that read, and want to read, what has actually been written.
if you want this property then offer the asking price this morning with a condition of moving in for November as you require, and good luck.

Most sellers don't like putting "offers over" on their listing as it can/usually puts buyers off as they like to see a set price. How does it stack up compared to similar sold properties nearby?

And I agree with pp, just because you think it needs 30K spent on it doesn't mean it does, repairs yes, cosmetic no, so if a bathroom is 20 yrs old but functional that falls under cosmetic and the buyers suck that cost up. If you like it then offer your best and final, good luck.

I rarely see offers over, it may be a legitimate tool but not one that is often used. To my mind, asking price is goal, and within around 5-10% of that is a legitimate offer providing there are no extenuating circumstances (survey issues etc). Whether you agree with their price is another matter.

I think that regional variance and market conditions make a difference to how properties are presented. At one point London properties went sstc before the vendor could sneeze so it would make sense to set expectations with offers over, but that wasn’t so in other areas.

Also both significant aspects in expectations.
eg OPs statement about one low offer in 4 months = overpriced. Not at all. It may be a niche property, a remote area, in the middle of an industrial estate, only had one viewing because the details or EA were ropey….

Just for perspective- I've just moved and I can't tell you how important the emotional aspect, and kindness, has been in both the sale of our old home and the purchase of the new one. I haven't met our buyers but they offered a fair price, and didn't try to reduce a huge amount after survey, only what was reasonable. Because of this, I decided to reduce further when some plumbing issues arose a week before exchange- I didn't have to disclose at all, but decided to do so and offer the money to rectify because they had behaved decently.

The sellers of our new home liked us a lot, we met them and they appreciated that we made a decent offer although the house had been sitting on the market for ages, and didn't ask for a reduction after a survey that raised concerns (we felt those concerns were fairly reflected in the price we'd already agreed.) The sellers fixed a flat roof before leaving without even telling us because they felt we'd been fair.

Yeah, I don't think I could be bothered selling to you as you sound like you'd be a real pain in the arse throughout the process.

You've been told what the sellers are looking for. Either give them that or go elsewhere.

Actually OP, please don’t. Move on from this property and buy something new from a developer instead. That’ll be best for everybody else involved. And you won’t be in a chain so can demand your timeframe.

@Tortephant All of those points will mean the property should be reduced! Looking at local property, there’s frequently a reduction after 3/4 months if the seller wants a sale. Everyone negotiates and many properties these days don’t have a queue of buyers! Vendors don’t get the opportunity to pick Mr and Mrs NiceFamily. They grab any buyer! Lots of these stories make no sense in the current market where many properties are stuck! One offer in 3 months is heading towards stuck. Either the vendors negotiate or they don’t, it’s their choice.

Plus loads of buyers have deadlines! Often families needing to move to get into a school. This is very normal. Some people on here take offence at everything. Of course buyers want a quick buy.

Also I’d never trust a quick fix on a flat roof! If anyone thinks that’s a good idea, think again. Flat roofs with patches are still in poor condition and obviously old to need work in the first place.

work out what price you are happy with by imagining you put an offer in for that price only to hear someone else offered more and bought it.

are you wishimg you’d offered more “i knew i should have offered an extra £xx”, or are you content with that outcome “they offered that much oh well fine it’s not worth that to me”.

run the scenario in your head on different prices.

the sweet spot is in the middle of “i wish i’d offered more” and “she can have it at that price, it’s not worth that much to me”

also check the council tax band and any maintenance on the estate or whatever is ok. one i looked at had factors fees of a grand a month. no thanks!

there are so many variables. there is not one route, one option, one right way! that was my point. So many different circumstances, never assume.

re. picking a buyer, not the way I have ever bought and sold. Without further thought I will reject an offer from somebody that I think will be difficult through the process, I'd rather achieve less and sell to "Mr & Mrs Nice', indeed, I've made some really good long term friends through buying and selling! I certainly would never "grab any buyer", never have and can't see a scenario where I would.

We are on the market and this summer has also had a new Prime Minister, economic uncertainty and a World Cup which have all apparently slowed or stalled the market. I think price drops may come in the second half of September for those who need to sell and in October for those who only want to sell. A lot will be waiting until the Autumn Budget or the ‘100 days of being PM’ date

Well this thread went wrong didn't it! 😂
I think there is an element of truth to what you have said. There is a group of sellers who get very offended by offers that are lower than they expected and decide not to deal with the potential buyer because they are angry and feel insulted. Personally, I find that a very odd way to deal with a business transaction.
Having said that, some of your responses are childish and some of the people who have posted do have very fair points. Buying one individual house isn't an exact science and the human interaction (being honest and decent) is relevant.
The best approach, in my opinion, is to research your local market carefully so that you have a good idea of current value, whether properties are selling or whether it has all ground to a halt. You can then weigh up your offer on any individual house logically and make one that you think is fair. I wouldn't keep gradually increasing your offer here if you think 6% below asking is fair (it may well be as it has aleready been on the market for 3 months). Perhaps leave this house and keep looking as you aren't in a hurry.

@Tortephant with the market as it now is, you might never get that gold star choice! Great if you can judge who is wonderful from day 1 (you cannot) and you are stuck if they are your only interested party and want a reduction after the survey. Of course you avoid this by having a tip top property but a renovation property is never this. Most people these days cannot pick the buyer they think is perfect.

I sold DMs bungalow and had no relationship with the buyer at all. They could have come from the planet zog for all I cared. I just wanted their money in a reasonable timeframe. Yes, a timeframe! I made it as easy as I could by being quick in my responses but solicitors are the slow ones in many cases.

I think the op is right to try and negotiate and 3 months with no sale does indicate a slow market for this house.

When house prices drop significantly it will be a sellers market, more recent buyers will lose money of course but we need to get back to normality soon, anything remotely at risk of wildfire now will plummet in value as well.

The bond market runs mortgage debt costs, specifically the "10 Year Yield", and Japan is in the spotlight as well, why do you think the FED is in such a panic trying to intervene in the value of the Yen etc.? People should prepare for 10% mortgage rates.

https://www.msn.com/en-us/money/markets/scott-bessent-fired-a-currency-bazooka-but-global-finance-still-looks-like-a-giant-jenga-tower-propped-up-by-a-japanese-yen-thats-in-deep-trouble/ar-AA2acfR7

This isn"t how markets work, if the house next door sells for less that is how much your house is now "worth", buyers can view dozens of properties until they get the bargain price they are looking for, the seller usually only has one property to sell and are at the mercy of buyers if they really need to move ( why do you think people talk about the three D"s controlling markets?) Someone offering 1 million on an already overpriced ex-council house on at 450k is strictly in the realms of sellers wet dreams unfortunately!

3 months slow totally depends on location. Regions are very different

No. Next doors house may have a 15year old boiler and new windows. It may have a NE facing garden rather than a NW facing garden. It may have a new bathroom or anolder one. What next door sold for is only the benchmark of yours is identical in every regard.

I live in a house of a totally different era and size to my neighbours. That doesn’t make them the same value.

Boilers, windows, garden are going to make minimal difference, people are looking at price, location, size. Of course if you have five bedrooms and the neighbour has three then there is a price differential but the housing market is full of people who think their house is somehow "special", it most cases it simply isn"t.

Err… we clearly live on a different planet.

Clearly we do.

I'm on the same planet as Tortephant. People talk about "the housing market" but buyers don't buy "the market", they buy one particular house. Even on a new-build estate, people differentiate between the exact same house/floorplan because they are in different locations. For example, buying or not-buying because of the garden orientation is definitely A Thing; it may make a "minimal difference" to some people but it can be really important to others.
As houses get older - i.e. changed over time by adaptions, extensions, etc - the disparities get even more pronounced.
Houses are not identical, just as buyers & their wishlists are not identical.

I agree that different houses will have slightly different values, even on an estate.
However, you are wrong about the seller who decides the price. What happens if no buyer will pay the seller's preferred price for years, as is happening frequently in the last few years? Those sellers have no influence on the actual market of transactions. They are kite flyers only. In a falling market, it is the sellers who need or really want to move who actually make the market. These transactions then influence what the kite flying seller's property is worth to the downside, as they have previously to the upside.

Did you leave the offer on the table? If anyone was thinking of offering something similar the agent will have told them there has been an offer under asking and it was refused. If you are very keen offer £430k and if it's refused say you are looking elsewhere.

Surprising to find first time buyers with so much cash, I'd expect my agent to actually confirm with your solicitor they'd seen proof of cash.