Making an offer

Discussion in 'The Buying & Selling Process' started by Ruan, 12th Nov, 2019.

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  1. Ruan

    Ruan Member

    Joined:
    25th May, 2018
    Posts:
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    Location:
    SA
    Hi guys,

    Recently I have been rejected 3 offers. All of my offers were closed to the high end of the advertising price.
    with the 3rd offer, advertising price by vendor agent was 480-520. Online ANZ valuation is 516. I made an offer for 525, unconditional, 30 days settlement (requested by the vendor who wanted to sell quick). I though it was generous enough, but still rejected.
    I really need some tips pls. I looked at all the recent sold in the area but they weren’t comparable.

    How to win this game?
     
  2. thatbum

    thatbum Well-Known Member

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    Perth, WA
    To a certain extent, you can't control what a vendor wants and how flexible they are to sell below that desired price.

    What you can control is your knowledge of what the value is of the property you are offering on is. Its not good enough just to say that you looked at some recently sold in the area but they weren't comparable - you need to stretch more to find something comparable and make the necessarily extrapolations.

    Its also not really good enough to rely on online valuations - they usually range from probably misleading to outright completely useless.

    How well do you know the market? I think you need to learn to largely ignore the asking price on a property, and get used to doing things (including offering amounts) based on your own solid assessments of value.
     
    Lindsay_W and SeafordSunshine like this.
  3. property_noob

    property_noob Well-Known Member

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    Sydney
    Yea it's hard. Especially for first home buyers trying to gauge the value of a property.

    I recently made 3 offers on a house and went up to the asking price. Was rejected. Made an offer higher than the asking price. Was rejected. Made an offer even higher which the vendor agreed to. I signed the contract and vendor came back after 2 days asking 25K higher than the initial asking price. I walked.

    Looking at comparable recently sold properties is a good idea.
     
  4. Curious2019

    Curious2019 Well-Known Member

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    VIC
    Expectations start at opposite ends for buyers and sellers. Buyers want to pay the least amount possible and sellers want the highest amount possible.

    My approach would be to decide first what you are looking for, I.e location, property type, no of bedrooms, bathrooms, other features and your price range. When you find a property that meets enough of your criteria, make an offer based on what you are prepared to pay for it. If the vendor won’t sell at that price then move on to the next property. Don’t get stuck on one property being your dream home, your dream home will be the best one you can afford at the time you are looking.

    If vendors come back with a counter offer you are prepared to pay, ask their agent to have the vendor sign it and send it to you so that there’s no continued back and forth. It will show whether or not the vendor is serious about selling or just gauging the market.
     
    Optimus likes this.
  5. property_noob

    property_noob Well-Known Member

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    This was the mistake I made. After numerous back and forth and the vendor agreeing to a price, I should has asked the agent to have the vendor sign. This would have indicated whether he was serious about selling at the agreed price.
     
  6. Ruan

    Ruan Member

    Joined:
    25th May, 2018
    Posts:
    19
    Location:
    SA
    Thank you for all of your advices. I am now interested to buy this property. It has been on the market for 23 days. But I think it’s longer than that as the images were marked “listed July 2019”. I went to a weekday inspection, there was like no one else attended (I came 15 min late anyway). This is a good location one but it’s out of date outside so the frontage photo looks very not attractive. But inside, it’s surprisingly neat and well maintained with 4 br and 2 baths and a big laundry. 480m2 of land
    The asking price is 550-570k. There was no recently sale of 4 br units to compare. There were one 3br, 1bath 300m2 recently sale at 530k. But it looks newer with updated kitchen and bathroom and nicer frontage. Another one unit 3br 1bath 660m2 with similar condition inside and nicer frontage sold at 592k.

    How much should I offer ?
     
  7. Curious2019

    Curious2019 Well-Known Member

    Joined:
    27th Sep, 2019
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    Location:
    VIC
    Hard to say, without knowing what you can afford. If they rejected your offer and it was already over the price guide, I’d ask them/their agent for a counter offer and see what they come back with otherwise you’re just bidding against yourself..

    What would you be prepared to pay for it?
     

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