WHEN you have found the house that you wish to purchase you will need to make a decision as to how much you should realistically offer.
Most people start at putting in an offer of between 5 and 10% below the asking price of the property. The reason behind this is that property is often priced slightly higher than the actual valuation of the house as estate agents are aware that people tend to negotiate when making offers on property.
Your first offer should not be too high or too low so it is important to think carefully before rushing into making an offer. If you offer far too low the seller or estate agent will not take you seriously and will tend to think that you are not necessarily genuine.
The same scenario goes for making a high offer, just because you have your heart set on a property don’t jump in too high with an offer as you may miss out on getting the property for less and this money could be utilised elsewhere.
Only ever in extreme circumstance should you ever offer more than the current market value of the house and only ever do this if you can realistically afford it. There always is a risk when your mortgage lender values the house that they will not lend above the value of the house so in these circumstances you must be very careful.
Before you offer on a house ensure that you have a maximum offer and do not go over this offer.
When thinking about how much to offer on a house if you are going to go in below asking price it is useful to think about what is acceptable and reasonable so the seller does not disregard you as a disingenuous buyer.
Things to think about when offering under the asking price
- 52% off sellers with houses on the market would consider a lower offer than the asking price
- 88% of sellers with houses over £500000 would agree to 5% below asking price if the buyer is not in a chain and has a mortgage in place
- 22% of all sellers would agree a 5% reduction on the asking price
If you are thinking of making an offer below the asking price of a property, the vendor is likely to ask for justification so ensure that you are able to do this for example you may feel the property needs work or any repairs you can discuss this as a reason for your lower offer.
Hopefully this has given you an idea on how much you should offer on a house however if you have any queries or questions, we are here to help so contact us today.
