The Real (estate) Story : Part 3
Property negotiations, how , why and the real story!
So you have found the area you prefer, you have viewed several properties, reduced the short list to two or three and decided on the preferred option.The favorite now needs to be concentrated on and negotiations can begin.
The agent may have indicated a lower offer may be accepted which would be very good news. The agent may helpfully indicate where an opening offer could be set but of course you are free to decide what offer you would like to put forward. The agent has certain knowledge in terms of how long the property has been for sale, how many viewings have there been and crucially if other offers have been made and turned down!
In recent times many properties have exchanged at or close to the asking price but there is no set rule. A lower but sensible offer may well be considered depending on the vendor’s current situation.For your agent to put forward your offer having cash ready and available as soon as due diligence is completed and a deposit is required puts you in the strongest possible negotiating position.
Clearly making a cash offer comes first but it is worth remembering to consider the furnishings and contents before opening negotiations. More often than not vendors prefer to leave the furnishings and buy new when they relocate. Selling second hand furnishings is not profitable so if they are to your taste or would see you through an initial period then add them into your offer.
When making your opening offer it is best to state that it is subject to a survey (for peace of mind rather than a way of renegotiating the price) and includes the furnishings and fittings which will be on an inventory list to attach to the contract.
You are now ready to open negotiations. Based on the asking price you have decided after consulting the agent that you will put forward an offer some percentage lower. In general there is usually an attempt to meet between your offer and the asking price and agree to the deal. However with certain properties, currently much closer to the vendors asking price has become the norm. Your agent will throw light on this as they will have knowledge of the vendor’s latest situation. Whether there have been other offers rejected, whether there are other viewings happening and ultimately is the vendor keen to sell quickly or not.
The timescale of negotiations are never the same. Sometimes agreement can be almost immediate and in other cases it can take several weeks or longer but in the end when successful the result should be a win/ win result for both sides.
Should the vendor, having considered your offer, not respond favourably as perhaps another offer has been received then you can always consider your other property choices and start to negotiate. Probably another visit to the properties will be required in this case.
With negotiations successfully concluded the next stage of the purchase process can begin. We will need to consider the roles of surveyors, lawyers, agents and exchange companies, how they all operate and how to ensure the buyer is fully protected through the purchase process right up until receiving the keys.
All this will be discussed in Part 4 of The Real (estate) Story!
Copyright: Chris Mayall, Director, Expatproperty Finders: November 2021