Negotiating the best price for your new home

We all want that dream home and we all want to feel we've got it for the right price, however to get to that place the process starts long before your conversation with the agent or vendor.

It's an old adage that if you fail to prepare, you prepare to fail. This is very relevant in the home buying process. It's also true that the agent or vendor sells you the dream, but it is you and the professionals you employ that can make the dream happen.

Establish how much you will need and if that is feasible

The first step is to ensure you will be able to secure the finance; of course, this is usually by way of a mortgage. Find out what you can borrow, how much it will cost and what the process is before committing to an offer and a tight deadline with the estate agent.

Negotiate carefully

Only once you know you can get the money you may need, are you ready to go into the initial negotiation.

Have a figure in your mind that you want to pay and stick to it. Be careful to keep this figure to yourself. Telling the agent and/or vendor what it is will leave you no room to negotiate.

Try to meet the vendor as well as the agent; if the vendor likes you, so long as you deliver, it might just work in your favour.

Do tell the agent and/or vendor if you can move quickly and don't have a property to sell as this can pave the way for a lower offer.

Do your best to find out the vendor’s – or vendors’ – situation. The agent – or they, themselves – may tell you. They might be 'must sellers' who have a set timeframe to sell for many varied reasons; if this is the case, then again your hand becomes stronger.

Ask how long the property has been on the market. Spring is the peak time for property sales so if it has been on since the spring and it's still not sold in August, it's ripe for an offer below the asking price. Alternatively, if it went on in November and it's now January, the vendor will likely be advised to hold out for more.

Be wary of making 'cheeky' very low offers. There is a human being on the other side and you are telling them how much their home (or that of a departed or incapacitated loved one) is worth in your opinion. It might just work, but you may put their back up and destroy your chances, even if you come back with a higher one. Do your homework and find out what similar properties in the area have sold for - http://www.rightmove.co.uk/house-prices.html can be quite an accurate barometer.

Remember that you get what you pay for; if a property is significantly cheaper than similar nearby properties, the chances are there is a good reason, such as structural problems, unusual construction, an unfavourable area, a short lease, flood risk, neighbour issues, for example. Don't rely on the agent to tell you; they work for the vendor and are being paid to sell it, that's all.

What to do once your offer has been accepted

Once you've made an offer you are comfortable with and it has been accepted, you’ll need to find out if the professionals think you got it right.

Paying for a more detailed survey or employing a good local solicitor instead of a cheaper online one could save you a great deal of money that you hadn’t accounted for, later down the line, when you move in.

Use their work to help you – if the surveyor thinks the property is worth less than your offer, they will tell you why. Show this report to the agent and/or vendor if you want to reduce your offer.

Take the advice of your surveyor, solicitor and mortgage adviser or broker. You are paying them to do a job so be sure to make use of them. If they raise issues, listen to what they say – you could use this to get a better price. It may be that you are advised to walk away if all is not what it seems. Everyone talks about property hunting with your head and not your heart; the professionals you employ will help you to do this if absolutely necessary.
If you’d like to discuss any of the information in this blog, we are always happy to help.

Happy house hunting!

January 2018