Think about how much you can afford to spend and how much the property is on the market for.
Before you make an offer make sure you are clear on your limit so if you original offers are rejected you don’t end up offering more than you can afford.
In some cases where a seller thinks their property will fetch a good price and sell quickly they will invite buyers to make sealed bids by a set deadline.
At the deadline these will be opened and the seller will decide which offer to accept. If the property is being sold in this way, the estate agent should make that clear when you first look round.
When it comes to ordinary purchases traditional wisdom has it that you should make your first offer 5 to 10 per cent less than the asking price.
If you can afford the asking price then making a low offer will give you room to manoeuvre if it is rejected. If you can’t then it’s worth a try.
However, if you can afford the full price and you know the property is of interest to other prospective buyers you might not want to risk someone coming in with a higher offer. In this case, you need to weigh up saving money against risking missing out on the property.
You have to decide what you feel most comfortable with and hope your offer is accepted. Bear in mind that it is not always the highest offer that is accepted.
A seller may prefer an offer from someone who is not part of a chain or someone who has an agreement in principle from a lender.
Unless you are buying the property in a private sale, you need to make the offer through the estate agent.
They may have an opinion on your offer price and tell you how likely they think the seller is to accept it. You can take this advice or ignore it, it is entirely up to you.
The estate agent must pass your offer on to the seller promptly, unless they have been told by the seller that some offers are unacceptable, such as those below a certain price.
Estate agents are obliged to treat all offers equally – for example they cannot favour a buyer because they are arranging a mortgage with them.
If you want the offer price to include white goods, carpets or anything else you think the seller may be prepared to leave make this clear when you speak to the estate agent.
Once your offer has been accepted the agent will send you a letter confirming the details. The offer will be “subject to contract” so until contracts have been signed and exchanged either party can pull out.
The seller can continue to accept offers and you can renegotiate conditions.
When the offer is accepted you need to contact your lender and solicitor to let them know that the buying process has begun. You also need to arrange a survey.
Should the survey unveil any problems that will be expensive to rectify and you still want to purchase the property, you can instruct your solicitor to renegotiate the price.
The buyer may feel that these problems have already been priced into the asking price and refuse to budge. If this is the case you may want to withdraw your offer.
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