Ok,
I want to put an offer on an IP (my first) in WA. The property is “from 299k”. Would an offer of 275 even get a consideration or would they just laugh? I know the only way is to try but just wondering how you guys would go about it.Our only other properties were our PPOR and paid with our heart not head.
What's the worst they can say? ummmm…. no!
That's not a bad offer, since I know I've offered a hell of a lot less before and been accepted.
Best of luck!
An offer presented in contract form is always considered more seriously.
Hi sammmeee,
This is an 'offers over' situation which, when done properly, can be a very good way to sell a house for maximum profit… Which is why the Scots love it!!
Of course, the reverse of that means that the buyer tends to pay top dollar or above for the same house… which is not so great!
It's similar to a car salesman asking "What price will get you in this car today?"
It puts onus on you to provide a price for what you think is reasonable (or lower), but on doing so the dealer is immediately in the position of strength with the ability to renegotiate or flat out refuse your offer. In turn you can only raise your offer on their terms, or walk away…. Good for them, but not so good for you!There are negotiating tips available all over the internet that can help with this sort of situation… But whether for a car, house, business meeting, or who gets stuck with washing up duty, negotiating is negotiating!! Ultimately the same rules apply as if you were buying any property, under any terms of negotiation.
So with that in mind, get your requirements in order, and make sure you have taken care of your homework. Research the local market, properties available, comparative sales, time on market, average rent for that kind of house, increases over the last umpteen years, and estimates to repair any problems with the property.
If you think your offer is reasonable, by all means put it in. But be prepared to:
1. Cite the reasons why you are offering below the asking. Your conclusion should be based on your home work and backed up with evidence.
2. Go one step further and anticipate the agents possible responses so that you can nail them with logic and more evidence to back up your conclusions.
3. Back away if it’s getting toppy. Performing the above two steps well may not affect the way the vendor or agent views your offer (or they may receive higher from someone else). You just need to stick to your guns, not get carried away, and identify your upper limit.
It's a buyers market out there right now, so if it comes off then great… If it falls through, there will always be another house just around the corner. The last thing you want to do is pay too much for a house, and then spend years in a slow or flat market trying to make it back!Thanks,
Here in perth there a lot of from xxx prices and i wasnt sure if this was to be taken seriously as it feels like a buyers market.
Do i tell the agent I want to put an offer in and then disclose price or best to tell him i want to put an offer in and only disclose in the offer contract?
we got a house lastyear that was listed at $330k and we got it for $250k. so ya never know unless u ask!!!! if i wasnt ballsy that day i very well may have paid a hell of alot more for that house. im soooo glad i risked offending cos it worked in my favour
good luck with your offer! let us know how u went
sammmeee, definitely go with your price of $275K. If they say yes, you're done! Easy
If they say no, make a lot of noises along the lines of, 'Oh….. that's disappointing….. my (wife/partner/OH/whatever) really doesn't want to pay above that…… s/he says it's not worth it to him/her to pay any more…….' then finish the call with, 'I'll talk to him/her and let you know by COB tomorrow.'
Don't call them by COB tomorrow – leave it another day or so, then call back – with $280K.
Trust me, this works like a charm! This is exactly how we've done it on many occasions and it's worked every time. Easy
And remember, have fun! As somebody once said, the bargain of the year appears on a weekly basis
Good luck!!
PS: I agree, it's definitely a buyer's market at the moment…. use it to your advantage.
Thanks for your advice,
Rang agent “hi I would like to put an offer on xxxx”
“Sorry thats already under offer…they put in the full asking price”
Doh!
thats sucks sammmee, im in the same situation except i found a unit in the block next door with a fully renovated kitchen and bathroom jsut like the one i was looking at and it was 200k+ the one next door sold for 190k so i put in an offer of183k havent got a response from the real estate agent yet and its being over a week…think hes trying to sweat me out but im massively stubborn
n i aint calling him again until he respondsTony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
tonyf387 wrote:thats sucks sammmee, im in the same situation except i found a unit in the block next door with a fully renovated kitchen and bathroom jsut like the one i was looking at and it was 200k+ the one next door sold for 190k so i put in an offer of183k havent got a response from the real estate agent yet and its being over a week…think hes trying to sweat me out but im massively stubborn n i aint calling him again until he respondsOver a week, I think hes givin you a miss, a lot of agents are slack and will not follow you up, When they play games like this or are to slack at calling back, I normally call them and put the pressure on, but I stay firm on my price, it just reinsures them that you are keen but your price is what it is and if there any good at what they do then they will get the deal done.
What i find interesting in the comments in this thread is that nobody asked the question, what is the property worth?
When you buy is when you make your profit, this has nothing to do with the asking price. Before you offer anything you need to know what the price of houses in that street and area have been sold for in the past year. NOT what they are currently asking. You can buy a report for under $100 at many of the data firms like rpdata which will tell you this.
In the past i have paid asking price for a property that was $150k undervalued. I now receive 14% return on investment. Had i not paid asking price the other 3 buyers would have bought the property, they were messing around haggling. Consideraton for what the market is doing and also why the seller is selling has to be taken into account along with many other things.
id offer lower. Hehe.
A great question to ask the agent is: Whats the lowest offer the vendor will take?
You may get a suprising answer.If they are a good agent they won't give you a figure and say something like: i don't know, why don't you put an offer in and see or they may give you a red herring and say I would expect something close to asking price would be considered. After all the agent is working for the seller and not the buyer, though sometimes it's hard to tell.
Money talks. Include a cheque with your written offer or signed contract
Graeme Freer | Freer Property and Finance
http://www.freerpropertyandfinance.com
Email Me | Phone MeBuyers Agent
Yes wobbie, it is about how much the property is worth. However I do find those rpdata reports to be extremely out! Our property is supposedly worth 780k via a rpdata report the night before the bank valued it at 610. (DOH!)
Update,
Didn't get that property. But I got accepted on another one. 8k above asking price.
Yes I know it sounds ridiculous. But I have now a property for 238k in perth 3×1 with subdividable corner block. Sweet deal and current rent is 280 but definately needs a makeover
I did try a cheeky offer but was told dont even bother with putting it in writing as there are 3 other offers already over asking. I wouldnt have normally believed that. But the fact I saw two couples putting in an offer at the first home open and saw one offer for 230 I had no option to believe him. Anyway was happy to pay the extra 8k
Thanks for sharing your experience with rpdata Sammmee. There is often a huge variation between Pricefinder and RPData estimates . eg Pricefinder estimated a Clareville property value in range between 1.1m and 1.3m yet RPData est was in range of $800-970k. Bank valuer assessed at $1.15. I scout out undervalue properties for my clients so need reliable estimates.
Graeme Freer | Freer Property and Finance
http://www.freerpropertyandfinance.com
Email Me | Phone MeBuyers Agent
Hi
Pricefinder and RPData estimates can be a guide, however its up to you to do your diligence. What i said previously was: Before you offer anything you need to know what the price of houses in that street and area have been sold for in the past year. I did not say get price finder to pick a number, this is not doing your diligence it's asking a third party to tell you what it is worth.
Well-done sammee on your purchase, it sounds a ripper buy.
freerenterprise in Qld a cheque doesn't make any difference, the amount of the cheque shows that you are serious however we dont' exchange contracts hear and the money goes into trust so no one gets value from it.
Sammmee
REBA website explains an offer to buy property in WA is made using the Contract for Sale of Land by Offer and Acceptance form, commonly called the ‘O&A. The NSW equivalent document is Contract for Sale of Land and only becomes legally binding on both parties after contracts are exchanged and deposit paid. In Qld contracts become 'unconditional' rather than exchanging, once finance approved.
Having a cheque made out to the Trust account of vendor's solicitors shows serious intent and adds strength to your negotiation.Kerrie
You can access Pricefinder via Investar for small additional subscription cost. Pricefinder and RPData provide recent sales data by street. Invaluable for doing due diligence on properties that meet investors' criteria.Cheers
Graeme Freer | Freer Property and Finance
http://www.freerpropertyandfinance.com
Email Me | Phone MeBuyers Agent
Try value the same property you have already valued on RPData & Pricefinder and you will find it is different, one of my properties dropped $50,000 in one week, yea right.
there valuations are a guide only
Some times they work the value out on the price you paid for a property, say your going to buy a house and the old owner paid $500k in 2007 then the valuation may come in at say $650k then you buy the property for $510k then get it valued again and it comes back around your $510k, hows that work, its the same property. i have properties side by side and I checked the value on each and one comes back at $120k higher than the other, I have owned the one that came back higher for a longer time,
some agents will wip out data and put it in front of you when they know it is showing a good value on the report, thats to help the less wise to sign on the dotted line
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