How to guarantee your offer is accepted!...

 

Us British people love a bargain, don’t we?! Especially us northerners. This is more prevalent when making the biggest financial commitment you will likely ever make – buying your home. Of course, we want to secure our dream home at the best possible price, but how do you make sure you do that but also fend off the stiff competition of other buyers for your dream? Well, heres how… 

 

The key is to work with the seller not against them, it’s a negotiation not a winner takes all battle to the death. You shouldn’t walk away feeling like you won the battle, but that you walked away with a win: win outcome. An outcome where you secure the house of your dreams at a fair price, but also so that the seller is happy, and they aren’t left feeling like you’ve had the shirt of their back. 

 

So, how do you achieve the win: win situation? Here are some top questions to ask the vendor or estate agent (depending who shows you round the house on the viewing), to gather the best information you need to make an offer that stands out above the rest whilst securing a great deal for you. 

 

Firstly, you need to discover what the vendors situation is. Are they buying another property? Moving into rented accommodation? Moving in with a partner? Buying a new build property that may not be ready until a certain date? Have they already found a new property, or have they only just started their search? 

 

This will help you work out a potential time frame for the sale, which will help you frame your offer. If they need to move fast you can explain to them that they are a first-time buyer or you have already sold your property so you are not going to cause them any delays. If they havent found a new property yet or their new build property isnt ready for a number of months you can let them know that you also aren’t in a rush and can work to their longer deadline. 

 

Then you need to establish what the vendor needs from the sale of their home to facilitate their next move. It may be that they need to sell their home for a minimum price to release a particular amount of equity to put down as a deposit on a new home. By asking this question you can find out what the absolute minimum price they would accept would be. You know that if you offer anything below this price that your offer will be rejected as it doesn’t allow them to move onto their new home. 

 

You also need to find out what your competition is, this is easier if you are speaking with the vendor directly as they will give away more information that the estate agent. The estate agent by law is not allowed to tell you what other offers the property has had, but the vendor will likely tell you. They may say something like “we had an offer £10,000 below the asking price which we rejected immediately”, they may follow up with “we were hoping for nearer the asking price than that”. That will give you a ballpark figure of what you will need to offer to be successful. 

 

You can arm yourself with plenty of information about the property before you attend the viewing too. Take a look at how long the property has been on the market, the longer it has been on the market the more likely a vendor would be to take a lower offer as they become more motivated to sell. You should compare recently sold house prices on Rightmove and Zoopla before you visit to see how this asking price compares to similar properties on that street that have sold recently. Is the property overpriced, or underpriced? If the property is overpriced, when you make an offer, you can offer what the previous properties sold for as this is in line with the market and can be backed up by data. You must take this approach with a pint of salt, if a property sold 5 years ago, that is not a true reflection of todays market. Whereas a property that sold 3 months ago is. 

 

Does the property need renovating or modernising? If so, you can factor the cost to complete the necessary works into your offer. For example, if the property is valued at £200,000 and you need to spend £20,000 to upgrade the kitchen, bathroom and paint throughout you could start the negotiation with an offer of £180,000 to reflect the £20,000 you are going to spend. 

 

Remember you want the vendor to work with you, so offering a disrespectfully low offer will turn them off working with you. 

 

We’ve talked about price, which is a key factor in whether a vendor will accept your offer, but another key factor is how likely you are to proceed with the sale and complete the transaction. A vendor wants to see that you have all the relevant pieces in place to qualify you offer (basically prove to them you can afford the house and have the means to pay for it in place) but what are they?... 

 

Proof of ID – To ensure you are who you say you are and that you have the right to buy a house in this country 

Proof of funds – This can either be the full purchase price in cash (in a bank account) or proof of your deposit 

Mortgage in principle – if buying with a mortgage agents will want to see you have been approved in principle 

Your solicitors’ details – you will need a solicitor to act for you for any property transaction so your chosen solicitors’ details will need to be shared with the vendor too. 

If you have a property to sell the vendor will want to see you have a sale agreed on your property also. 

Without these pieces in place at the time of making an offer on a property the vendor cannot see that you can proceed at this time. If you are waiting for your property to sell there is a chance that you cannot proceed, and the vendor may not be willing to wait for you. Your property may never sell or sell for the amount you need so they may want to leave the house on the market for other potential buyers to view to find a proceedable offer. 

 

If you do not have a mortgage in principle in place the vendor doesn’t have the reassurance that you can obtain a mortgage for the larger part of the purchase price. 

 

This is where cash is king, if you are buying with cash, you do not need a mortgage or need to sell a property. You can act immediately with little to no risk. You do not have to wait for a lender to give you the green light you can proceed as long as you are happy. The 2nd best buyer type is a 1st time buyer (especially one prepared with a mortgage in principle, proof of funds and a solicitor on hand). This is because their ability to proceed is not based on a property selling, they have a deposit in the bank and a mortgage in princple they do not need anything else. They will then form the bottom of the chain so this can speed up the process as it reduces the number of parties involved in the chain. Most likely, they still live at home with mum and dad so they are not in a rush to complete which allows the vendor to dictate the completion date which can also give them peace of mind. But on the other hand, first time buyers can act faster because they are the bottom of the chain so the can act quicker than any other buyer type too. So, depending on the vendor circumstances, you can play to either preference of the vendor – a fast sale or a slightly drawn out sale. 

 

By offering a reasonable price for the vendors property that allows them to proceed with their onward plans, and by proving that you can proceed now and proceed in a timely fashion you will be able to secure the property you fall in love with at a price you adore.