How to Make an Offer on a House
Getting ready to buy a house is an exciting time, but it can also be a bit overwhelming. One of the most important steps is making an offer on a house. We really wish it was as simple as saying "I really want this one!" But, let's face it, it's not. So, we're here to guide you through the process, giving you tips and things to watch out for along the way.
Before you make an Offer
🚶Visit the property multiple times
It's essential to view the property more than once to get a better sense of its condition, surroundings, and how it suits your needs. Different times of day can provide different insights.
🏦Have a mortgage in principle
Before making an offer, it's a good practice to secure a mortgage in principle from a lender. This document shows that you are a serious buyer and can help in negotiations.
💸Determine your budget
Calculate the maximum value you are willing to pay for the property. Make sure your budget accounts for all associated costs, including stamp duty, conveyancer fees, surveys, mortgage fees, and moving expenses.
📚Research the property’s history
Investigate the property's history, such as past ownership, any legal disputes, or construction work. This information can be crucial in understanding the property's value and potential issues.
✍️Write a letter to the owner
If the owner currently resides in the house, a personal letter expressing your attachment to the property and your vision for it can appeal to their emotional connection and make your offer more attractive.
📜Ask for the Buyers Information Pack
This pack contains essential documents and information about the property, which can help you make an informed decision.
🧑💻Check council tax and utility costs
Understanding the ongoing expenses related to the property will ensure you can comfortably afford it.
⚒️Request details of work done previously
Inquire about any renovations or improvements made to the property. Photos, certificates, and before-and-after comparisons can provide valuable insight.
🗣️Communicate with the estate agent
Understand the seller's motivation for selling, their timeline, and whether there are any competing offers. This information can be beneficial during negotiations.
Making the Offer
📝Submit the offer in writing
Always put your offer in writing, typically through an email, to ensure clarity and transparency in the negotiation process.
🔊Share your position
Inform the seller about your chain status (whether you need to sell your current home), your financing requirements, and any other contingencies.
⛓️Include your stipulations and contingencies
Be sure to express any conditions you'd like to include with your offer, like a reservation agreement, specific repairs, or a set timeframe. If you're using Clear Chain, you can also take this opportunity to specify that you expect the rest of the chain to utilize the app to ensure the process runs smoothly and efficiently.
Types of Offers
🖇️Open vs Sealed bids
Be aware of the different methods used for receiving offers. Open bids are disclosed to all buyers, while sealed bids are kept confidential. Understand why the sealed bid process is being used.
👍Best and Final Offers
In situations where you're asked for the "best and final" offer, remember not to exceed your maximum budget. Each agent and seller basically makes up their own rules for this process so don't be afraid to break them. Ultimately if you are willing to pay more for the property then others you will just need to find a way to communicate to them. At the same time if the agent or seller is being difficult now then the chances of the sale falling through goes up.
🧐Negotiating a price
Be prepared for negotiations. Sellers often reject initial bids in the hope of getting a higher price. Don't be afraid to make subsequent offers but always stay within your budget.
🤔Understanding the Agent's Role
The estate agent is obligated to share all offers with the seller, so maintain open communication with the agent throughout the process.
🔒Closed Bids
Even in closed bid scenarios, it's worth asking the agent for information on other offers, as this can inform your next steps.
House hunting can be a rollercoaster, and it's okay if you lose a few properties. Sometimes, you gotta lose a few to learn how to win one! Plus, sellers and agents have their quirks, and the rules can change like the weather. Just remember, you're in for a journey with these folks, so keeping an open line of communication with the seller and agent is your golden ticket to a smooth property ride!
