Buying a house Making an offer on a property

A woman making an offer over the phone

If you make an offer below the asking price it should still be a sensible one

How do you decide how much to offer when buying a house - and when is it appropriate to offer below the asking price?

When you make an offer on a property, it is more likely to be accepted if it's based on your knowledge of the seller and the local market as well as the house itself.

While a bit of haggling is often to be expected, don't offer so little that you enter a lengthy negotiation process, as you might lose the property altogether if someone else makes a higher bid.

If there have been other offers on the property, the estate agent can't legally tell you how much they were for, but they may indicate whether they were close to the asking price, which will also help to inform your own offer.

Find out more: How much mortgage can I afford? - our tool suggests what you can afford to spend 

Expert video: how I decided how much to offer

Which? mortgage adviser David Blake and property surveyor James Rangeley explain how they used their industry knowledge to decide how much to offer when buying their own homes.

 

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Video transcript

We took the build around, we got estimates for how much it would cost to do the work to property that we needed to deal, and therefore the offer was based on a combination of the estimates from the builder, what we could afford and also what this evaluation had shown up, so when we were going back with our offer, it's based on factual information. We got home buyers survey carried out on the advice of the survey that we use which was local to the area, I knew that the area and property very well. When we did that in the process, I believe it was after we decided that we want to make an offer on the property, we fully understood that would be a case that we've been risking some money, but in the grand scheme of things, actually, we'd rather spend a bit of money and get things right and be able to offer with based on factual information, I think it makes a stronger offer.

You are, to a certain extent, relying on the guide price put forward by agent and also your own experience having viewed, hopefully, number of other properties and got a feel for what the values are. Perhaps, during your period of searching, you'd have seen houses that you've viewed sell to other people, and that's a good indication that pricing is in the right sort of area.

But, essentially, you won't know the answer to what somebody is prepared to pay for it, and in good market, some people are prepared to pay more than others, but you can do certain things, speak to other agents, speak to a local surveyor, just ask casually about the house and possible values, ask for comparable evidence from the agent.

If you're serious about buying, they would be as helpful as possible in supporting the price that they're asking. And, if they can't provide an information or refuse to, then it's possibly a suggestion that what they are asking is perhaps too much money. What we'd seen a lot of houses, we've probably seen about 15 or 20 houses in quite a large search area, but we had a pretty good feel for what houses that matched our criteria were achieving and what people are asking for them.

So we knew that there was a range that we had to work within but we asked some fairly probing questions of the agents, this is what we've been told. Locally, over the last 6 to 12 months, they disclosed and we also found out from other agents that houses in the same street had sold within the last six months, and either direct enquiries to those agents or land registry searches disclose the prices paid, and we went a bit further than most and we obtained old sales particulars corresponded those with the property that we were hoping to buy, and obviously, what somebody takes for the house next door may not be the same as what the center of the one you like, is prepared to take, but at least you've got a good indication of what price is going to be.

Making an offer below the asking price

The asking price does not always reflect a property's worth. Be proactive and research the local market to get an accurate picture of what the house or flat should really cost.

Common reasons for offering less than the asking price include:

  • A similar property recently sold at a lower price and the market hasn’t changed.
  • There are some repairs or improvements that would need to be carried out for you to be happy in the home.
  • The seller has a motive to complete the deal as soon as possible, for example, if they need to move quickly due to a pregnancy or job.
  • The property has been on the market for a while and no one else has made an offer recently.

It's worth bearing in mind that many people find selling their home very emotional and you risk insulting or upsetting them if you go in too low. Before putting in that cheeky offer, think carefully about whether the saving is worth risking losing your dream home - and whether you think you're being fair.

Go further: How to value a property - this sellers' guide should help you calculate a fair offer on a home.

When to offer the asking price (or more)

If the property ticks all the boxes on your ‘needs and wishes’ list, it may be worth offering the asking price straight away - especially if you don’t intend to move again for several years.

Those competing with lots of other bidders might even want to consider putting in an offer above the asking price. 

In fact, in thriving property markets where bidding wars are common, it's more than likely you'll have to bid above the asking price to land your dream home, so make sure you factor this into your budget.  

Making an offer to an estate agent

When it’s time to make your offer, your research into the value of the property, your understanding of the seller’s circumstances and being clear about your own position (especially if you're chain-free or are a cash buyer) are all invaluable.

You can make your offer to the agent either over the phone or in person at their offices. Either way, it's worth also putting your offer in writing and agreeing a provisional timescale to work towards for completing the purchase.

Make sure that the price you're offering is subject to a survey and getting a mortgage, so that after your offer is accepted there is still the opportunity to revise the amount you pay, and also state that it's subject to the property being taken off the market and not being shown to anyone else.

Go further: Buying through estate agents - learn more about your rights and the fees involved.

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