John Fitzsimons looks at how to work out what offer to make on a property.
John Fitzsimons looks at how to work out what offer to make on a property.
John Fitzsimons looks at how to work out what offer to make on a property.
So you’ve found your perfect property. Now comes the tricky bit. How much should you offer? You want to get a bargain, but you don’t want to lose out on the property.
Your budget
Obviously, before you can even think about putting in an offer you need to know what your budget is. Before you start looking around for properties, you should get an agreement-in-principal from a mortgage lender, which will give you an idea of how much they are likely to lend you. You should also have your deposit in place.
However, be sure to take account of other costs you will face, like solicitor’s fees and surveys, so that you don’t end up overstretching yourself.
The seller
Next you should take a look at the circumstances of the seller, as these will dictate just how keen they are to shift the property, and how quickly things can move.
If they have already found a new property, they will likely want to get on with it, so you might be able to knock a chunk off the asking price.
Similarly, if the property has been on the market for a long time, it might be dawning on them that the asking price is a bit high, so you might be able to convince them to go for a lower offer.
Your own situation
Your own position as a prospective buyer also plays a part in how likely the vendor is to accept a cheeky offer. Being flexible is a real asset, so if you aren’t involved in a chain, or have already lined up a buyer and can move quickly, the vendor might be tempted to accept a smaller offer for the sake of getting things moving.
With my own home we managed to get almost £20,000 off the asking price, simply because we could complete within a month!
When it comes to making the right offer, be sure to do your homework. You might also like to ask for some specific advice from our mortgage team, so head over to lovemoney.com/mortgages.