Once you have identified a house you want to purchase, it’s time to decide how much to offer. Should you make a high offer to secure the deal, but risk overpaying? Or should you make a low offer and risk losing your dream home?
Finding the right balance can be tricky, but there are a few strategies to ensure that you get the perfect property at the best possible price.
In this article, we will explain how to negotiate the house price, how to get the best deal, and techniques for haggling. With the right approach, you can get the house of your dreams at a price you can be happy with.
Table of Contents
How to negotiate a house price down?
Here are top tips for negotiating a house price and getting what you want:
- Researching the property thoroughly and viewing it carefully,
- Missing no details is key to negotiating a house price and getting what you want.
- Knowing the asking prices of similar properties in the area is also important.
- Presenting yourself as an attractive buyer, such as being cash-only or chain-free, can help your chances.
- Communicating openly and clearly with the seller is also beneficial.
- Reviewing the EPC can help you make an informed decision.
- Implying interest in other properties can help you negotiate a better deal.
- Starting low is also recommended.
- Making a second bid specific can help you get what you want.
- Asking for certain items to be included in the sale can be beneficial.
- Utilizing the property survey and a buying agent can also be useful.
- It is important to know your limits when negotiating a house price.
How to do research on a property?
Research similar properties in the local area to find out how much they have sold for. This will give you a reliable comparison and a realistic estimate.
Be sure to learn all you can about the house you intend to move into, as well as information on the local area – a property report can be of great help. You may be able to use this to your advantage.
How much to offer on a house?
Begin with a low offer. Expect your initial bid to be declined. Before beginning negotiations, use the following factors to determine how much a property is worth when making an offer.
Deduct 10%
There can be a discrepancy between the value of a property and its sale price. As a rough guide, it is sensible to offer 10% less than the asking price. However, this isn’t always the best course of action. Property investment is a major decision, so it’s important to take everything into account.
Factors which affect a property’s value
There are a few elements that can affect a property’s worth. These include:
The House:
- Size
- Condition
- Age
- Garden size
Position:
- Orientation
- Outlook
- Noise
- Neighbours
Location:
- Proximity to schools
- Proximity to shops
- Proximity to transport links
- Proximity to leisure facilities
The timing of your offer
If a property has just been listed, it’s unlikely you’ll be able to get a great deal. The seller will likely view a lot of initial interest as a good sign, which means they’ll leave the property on the market for longer to see what happens.
If you’re trying to buy a house that has just been put up for sale, you may need to make a higher offer to get it.
When will a low bid be successful?
Certain circumstances can make buying a home go in your favour. These include:
- Time on the Market – If a property has been on the market for an extended time, the vendor is likely to be eager for a sale. This can be helpful when determining what price to offer and increase the chances of a low bid being accepted.
- Lack of Other Interest – If you are the only party interested in the property, this could go in your favour.
- Working to the Seller’s Timings – If the seller is in a rush, accommodating their schedule can help you secure the deal you are hoping for.
- Multiple Estate Agents – If the seller is using multiple agents, one of them may encourage them to take a lower price to get the sale done.
- Being an Easy Buyer – Demonstrate that you can act quickly, show interest, and don’t waste your time. If you are free from a chain, this can make you a more attractive buyer, since the seller won’t have to wait for you to sell your property before they can purchase theirs. Be sure to have all of the necessary funds available and show that you are enthusiastic about getting things moving quickly.
- Presenting yourself as a confident, reliable buyer can help you get the house price you want. Make sure you look the part and be sure to stick to your guns.
- If you imply that you’re looking at other properties in the area, it can give the seller an incentive to accept your offer.
- Showing that you have a mortgage in principle can also help prove that you can afford the property, which makes your offer more attractive in the eyes of the vendor.
- Review the property’s EPC. If it isn’t as energy efficient as it could be, you could try to negotiate a lower sale price. Explain that you want the cost of making the house more energy efficient to be taken into account in the price.
- It is essential to establish from the beginning what is and what isn’t included in the sale. If you have to pay more than you’d like or increase your offer, you could ask for items to be included in the sale. You could also try to negotiate some incentives.
- Look for items which are not considered fixtures and fittings, such as a cooker or white goods. Asking the seller for freebies can help you save money in the long run.
- When it comes to home negotiation, don’t reveal your real budget. The seller or agent will always try to push it as far as possible! Cash buyers are more attractive, as they can move quickly. If you can buy in cash, this may help you secure a lower price.
- Lastly, always get a property survey on the one you’re looking to buy.
How to negotiate a house price after a survey?
A survey is more than just a “check”. It’s a way to ensure that you’re paying the right amount for a home. Any defects identified will affect the value and could have a significant impact.
If the survey reveals some serious issues or faults, you’re within your rights to reduce your offer (which is one of the few times gazundering is permissible!).
There are a variety of problems that could be uncovered in a survey, from electrical issues to dampness, that vary in their severity and cost.
When facing a bad survey, you have three options: pull out of the purchase, negotiate, or accept it as it is.
When it comes to negotiations, many people prefer to approach the seller first. However, your next step should be to show the estate agent the survey report. Be transparent and honest with both the seller and the estate agent about the costs associated with what has been found.
- Do some research to present your case.
- Consider how severe the faults are (if they’re minor, you may not be in a strong position). Calculate the cost of renovating the property to get it into a “good condition”.
- Obtain quotes from independent contractors to get an idea of the cost of fixing the issues.
- Share these quotes and estimated costs with both the seller and their agent.
- Present the seller with a discounted price to consider, or ask them to fix the issues.
- Throughout this negotiation phase, work closely with your solicitor and listen to the surveyor (they’re the professionals here).
- Be patient and be prepared to make compromises. Don’t be pressured into buying a faulty property.
- Building a good relationship with the seller can help, but if they refuse to negotiate, ask yourself how much you want the property, and weigh up the cost of fixing the potential problems.
- If there is high demand for the property, you may be in a weaker position. However, remember that a house is only worth what someone is willing to pay for it.
Useful bargaining chips
The most important part of this process is to make sure the factors align with what the seller desires. This is especially necessary when you are proposing a price lower than the asking price.
Know your limits
Even if this is your dream home, don’t let yourself be pressured into paying too much. Establish a maximum budget, taking into account other expenses such as stamp duty, and keep this figure to yourself. If your maximum offer is declined, start looking elsewhere.
What if your negotiations are successful?
If you can get a lower price for the property, make sure to contact your mortgage lender right away.
This may have an impact on your offer and could necessitate changes to the application. It is also wise to contact them during the negotiation phase to make sure they are ready for any modifications, which could take a few weeks.
After your offer has been accepted
Once a seller has accepted your offer, it’s important to get them to take the property off the market. This will stop other buyers from interfering with your purchase.
If they don’t, be sure to question why the property is still being marketed. Be cautious when spending money on surveys, solicitors and mortgages.
Once your offer has been formally accepted, it’s time to find and appoint a conveyancing solicitor and arrange a house survey.
Research by MFS shows that 1 in 3 homeowners who bought in the last 10 years experienced the seller withdrawing from the deal after accepting their offer, due to receiving a higher offer elsewhere – a process known as “gazumping”.
If this happens to you, it could cost you hundreds or thousands in pointless fees. The only way to prevent this is to counter-gazump by placing a higher bid than the gazumper.
In England and Wales, a verbal offer and acceptance are not legally binding on either party until contracts are exchanged. This is known as SSTC (sold subject to contract). If either party pulls out, the buyer may lose their holding deposit (if one was required).
To make the offer legally binding, you should firm up conveyancing quotes and formally instruct.
Sell to us!
At Property Saviour, we are cash buyers of property. We buy all types of homes, in any condition, in any location.
We can complete a sale in a timescale to suit your needs – be it a week, a month, or even a year. Our speciality is fast sales!
Property Saviour Price Promise
- The price we’ll offer is the price that you will receive with no hidden deductions.
- Be careful with ‘cash buyers’ who require a valuation needed for a mortgage or bridging loan.
- These valuations or surveys result in delays and price reductions later on.
- We are cash buyers. There are no surveys.
- We always provide proof of funds with every formal offer issued.
We'll Pay £1,500 Towards Your Legal Fees
- No long exclusivity agreement to sign because we are the buyers.
- You are welcome to use your own solicitor.
- If you don’t have one, we can ask our solicitors for recommendations.
- We share our solicitor’s details and issue a Memorandum of Sale.
Sell With Certainty & Speed
- Our approach is transparent and ethical, which is why sellers trust us.
- 100% Discretion guaranteed.
- If you have another buyer, you can put us in a contracts race to see who completes first.
- Complete in 10 days or at a timescale that works for you. You are in control.
