Home Buying Part 1: Knowing what to expect
Once you’ve found the home of your dreams, you’ll need to put down an offer that the seller simply can’t refuse. In order to ensure someone else doesn’t snap it up, you’ll need to secure a price quickly and confidently, as well as offering a price that’s right for you. Negotiating a price on a property can be somewhat daunting, especially if you’re a first time buyer and you’re new to the whole procedure.Knowing what to expect is extremely important when it comes to negotiating an offer, as you need to undergo some basic research and preparation so that you have a good chance of securing the property.
A little preparation
It’s important to note that an Estate Agent will try and drive the market upwards, as they are working on the vendor’s behalf to obtain the highest possible sale price. Prior to putting in an offer, it may be wise to arm yourself with data of recent comparable house sales by using websites such as Zoopla, Nethouseprices and Rightmove to see what similar properties in the area have sold for.
This data should be used as a benchmark for gauging the level of offer to put forward, as this is also what the lender’s surveyor will look at when valuing for mortgage lending purposes. If the lender’s surveyor down-values the property and the vendor will not reduce the agreed price then unfortunately, any valuation fee that has been paid to the lender may be lost.
Understand the market
It really is a ‘buyers’ market – the availability of credit (mortgage funding) is low and the number of sellers far outweighs the number of buyers. Hence this is what has reduced house prices nationally on average (due to the basic law of supply & demand).
In this market, a vendor is expecting to achieve a price lower than the asking price and on average the final sale price is typically between 90 & 95% of the original asking price.