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Buyer demand rises: how to buy a home in a competitive market

Find out how to have your offer accepted in a competitive market

More people are looking for property to buy but the number of homes for sale has remained unchanged, according to Rightmove – so how can you secure a property when competition is fierce?

Rightmove looked at the first 10 days of January and found that the number of people visiting the site had risen to over 4 million each day, up 9% on the same period in 2017.

However, the number of properties for sale was the same as last year, averaging 42 per estate agent branch.

 


Not enough property for sale

Around 40% of the homes listed for sale on Rightmove are ‘sold subject to contract’, meaning the seller has accepted an offer from a buyer.

This means the number of properties actually available to prospective buyers is far fewer than 42 per branch.

If you’re buying in an area where demand outweighs supply, there can be multiple buyers vying for the most popular properties.

Tips for buying when demand is high

Follow these tips to place yourself in the best possible position:

  1. Get out there
    In buoyant markets the best properties sell before being listed online. Visit estate agents in person and keep in touch with them – that way they’re more likely to call you when your perfect pad hits their books.
  2. Prove you’re serious with a mortgage agreement in principle (AIP)
    Sellers and agents don’t want to waste time on people who can’t actually afford the property. An AIP is a written confirmation of how much a mortgage provider would be willing to lend you in principle.
  3. If you already own a property, ensure it’s under offer
    Vendors may be reluctant to accept an offer from someone who still has their own property to sell, in case it delays completion.
  4. Emphasise why you’re the best buyer
    Are you chain-free or a cash buyer? Make sure that the seller knows this, as it’ll make you more appealing than others who are stuck in property chains or waiting on mortgage applications.
  5. Tug on the heart strings
    Selling property is often an emotional process. If you fell in love the moment you walked through the door and can envisage your family being happy there, mention it – if there’s very little difference between you and another bidder, it might just be what secures you the property.

Best and final offers and sealed bids

If you and another buyer are both interested in the same home, you might be asked to make a ‘sealed bid’ or a ‘best and final offer’. In these situations, both buyers will be asked to put forward an offer for the seller to consider.

While it’s important to pick a number that’s attractive, don’t go over your upper limit. You can find out more in our guide to making a sealed bid or best and final offer.

Property buyers being more picky

Rightmove’s traffic stats may show that more people are looking to buy a property – but the number of sales that were agreed in the last quarter of 2017 was actually down 5.5% compared with the same period in 2016.

This indicates that, even if demand is strong, buyers are becoming more selective about what they offer on.

If you’re selling a property, it’s obviously important to declutter and clean – but there are some other steps you can take that will help you shift it more quickly:

  1. Showcase your home’s potential
    Do you currently use one of the bedrooms as a gym or music room? Put a bed in there to show how the space could be used. And if your loft is ripe for conversion, tell potential buyers (or point out neighbours who have already done it to show that gaining planning permission should be easy.)
  2. Neutralise the decor
    It might sound boring but neutral colour schemes really do help properties sell. If your brightly decorated pad is festering on the market, it’s worth spending a weekend painting the walls white. The fresh, clean feeling of a new paint job is also likely to boost your property’s appeal.
  3. Set a realistic asking price
    Some estate agents may over-value homes in order to win business. Always get at least three companies to value your property and then set your asking price based on the average valuation combined with what similar local homes have sold for recently – you can check this on Zoopla.
  4. Act swiftly
    If you were ambitious with your initial asking price and you’re not getting people through the door, consider reducing the price sooner rather than later. It will save you from wasting further time and missing out on potential buyers.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

Categories: Money, Mortgages & property

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