With the advent of the internet finding a property to buy has never been easier. With a multitude of photographs, floor plans, Google Earth and Street View it is possible to buy a property from your notepad or mobile phone. But sooner or later you will have to view the property and come into contact with agent’s, lenders, financial advisers and surveyors.
You might think that with all of the technology that helped you to find the property that you want to buy, that the process was now considerably quicker. Unfortunately the system of property transfer hasn’t improved in the past twenty years and in some instances it is actually worse.
Choose your Advisers Wisely
Seek out Independent advice in all areas and ask lots of questions. It truly is worth doing homework before you engage advisers and agents who you will be spending the next who knows how many months with. Deal with the people that provide you with good service. If they can not answer their telephone or emails move onto someone who can. If you catch the slightest hint or scent of poor service ditch them.
Shortlisting
Prepare a short list of your requirements and write down all of the reasons why you want to move.
Bear in mind this key word COMPROMISE. The ideal house doesn’t exist. Have priorities but decide which ultimately comes first and what has to be sacrificed.
Viewing
Leave enough time between viewings. Don’t take the children, in laws and parents on a first viewing. Don’t view property that you have no intention of buying just to add to the list. Sellers can invest lots of emotion leading up to and after a viewing appointment so be courteous and provide honest feed back for the seller.
Should I have a proper survey on my purchase?
YES always.
If you require a mortgage seriously consider having a proper survey independent of the mortgage valuation. When a mortgage valuation is carried out the valuer works for the lender even though you have paid for the valuation. When you have a combined mortgage valuation and buyers survey the surveyor is now working for two clients at the same time. The question we ask is who comes first you or the lender? We know of a situation where a valuer valued a property at nil for the lender and recommended not to lend but still carried out a full survey valuing the property at the full agreed purchase price.
While it is initially more expensive to take the independent route (lenders and some financial advisers are earning commission by recommending the lenders combined survey and sell the idea as a cost advantage) it could be to your ultimate advantage in the long run as an Independent Survey is confidential to you and not shared with the lender.
The alternative is to have a combined mortgage valuation/survey arranged through your lender. This may not be confidential to you and could allow your lender sight of a survey that they have not paid for. The survey report could then used as the basis of their lending decision which may not be to your best advantage.
Making an Offer
This is a sensitive subject. There is no Golden Rule or formula or percentage that an offer should be below an asking price. The advice given on one estate agents web site is “offer the full asking price”. That may be right in some instances but with erratic valuations systemic in the current property market and over ambitious expectations of some is that really the best advice on offer. We know of examples of overvaluation and inflated expectations of £50,000 to £100,000.
Culturally we are hopeless at negotiating and too much is read into an asking price as though it were set in stone.
An Estate Agents role is obtain the best price that the market will support. From that it should be clearly understood that the final arbiter regarding value is determined by the buyer. Having said that the seller is not obliged to accept any offer at all, even the asking price or more.
To assist in understanding the mechanics and psychology of the property market you may be interested to review this scenario.
A property is offered for say £325,000. It has been on the market for 20 weeks. It hasn’t sold but there have been plenty of viewings but not one offer. It is in a popular area, close to good schools, the M5 isn’t whizzing past the bedroom window and neither is there a pig farm next door. There are lots of reasons why this property should have sold but it hasn’t.
Experience indicates the property is overvalued by £40,000 to £50,000. How can we deduce that? Well politeness prevents buyers from vocalising that the price is too high as most buyers’ reasonable parameter for negotiating is £5,000 to £15,000.
Now if we were to assume that the market perceived a value of say £300,000 it is just possible that one buyer would have chanced his arm and offered £300,000. But they didn’t. This property has sat there for twenty weeks, it is a very a nice house but not one offer has been received. Oh and after ten weeks the sellers changed agents. The first one obviously was not very good which surprised the sellers as they very much liked his recommended asking price.
To understand what is happening is to understand the psychology of buyers which is in fact to second guess the mind set of sellers. Buyers will have evaluated the property at £275,000 and concluded that the seller is seeking £310,000. So no point in offering what they consider to be their own appraisal. Best not upset any one. After a viewing the buyer says the gardens are too small or the garden faces south west and they wanted one that faced south or they didn’t like the colour of the bathroom carpet, just about anything other than they felt that the price was too high.
The buyer will sit watching the property websites for week after week waiting for the seller to reduce the price closer to the price that the buyer is prepared to pay.
In the buyers mind it is important that the seller concludes themselves that the asking price is too high rather than be the cause of possible offence by making the suggestion themselves.
Conclusion.
Don’t be shy, make an offer.
Contact us and speak to us about buying a home