Making offers

[Brenda Irwin]

Hi all, I am wondering how agressively you make offers. Probably plenty of you offer less 5%, or maybe even 10% off asking price.

Do any of you start at 30% off asking price? How do the agents take it? Do you have to pick them up off the floor and do CPR?

Has anyone ever had success in offering 30% off? What is the best discount you have gotten to date?

 

[simonjulie]

Hi Brenda
In a slow market, we usually wait until the owner has discounted the property considerably themselves. Usaully they are under pressure from their agent to keep dropping the price if there is little interest in the property.
Then we wait until the price starts to look good with our figuring and then we come in with an offer that is not that much lower than what they are asking.
This process can take some time but if you are constantly actively looking and watching the market it can be a great way to continually pick up a property at a good price.
So number one on our searching critera is How long has the property been on the market? The longer the better for this strategy to yield a bargain.
That strategy is the way we have mostly used to build our property portfolio.
Simon

 

[Brenda Irwin]

In a slow market, we usually wait until the owner has discounted the property considerably themselves. Usaully they are under pressure from their agent to keep dropping the price if there is little interest in the property.
Then we wait until the price starts to look good with our figuring and then we come in with an offer that is not that much lower than what they are asking.
This process can take some time but if you are constantly actively looking and watching the market it can be a great way to continually pick up a property at a good price.
So number one on our searching critera is How long has the property been on the market? The longer the better for this strategy to yield a bargain.
That strategy is the way we have mostly used to build our property portfolio.
Simon

Hmmm, I have been looking at a place for ages and its been listed for ages but the price never drops! In a usual vewings of 300 on the net for this area before sale, this place has had 934 and only about 4 were my viewings.
Spoke to the agent who says the best he would come down is 4%. Pittance!

 

[willair]

Has anyone ever had success in offering 30% off? What is the best discount you have gotten to date?

I would have to say no,not 30% off the listed price but the way i look at
things most vendors add 10% on to their asking price so in these times
maybe that may work in the right area,from what i'm starting to see
Brisbane is starting to move very quickly again in some inner city areas.

good luck willair........

 

[simonjulie]

Hmmm, I have been looking at a place for ages and its been listed for ages but the price never drops! In a usual vewings of 300 on the net for this area before sale, this place has had 934 and only about 4 were my viewings.
Spoke to the agent who says the best he would come down is 4%. Pittance!

That is why we look at a number of properties at one time. Usually one of the selection falls into the net.
There is nothing wrong with a vendor sticking to their price. in fact it shows some real strength on their part. However we would just wish them luck and pass them by and go on to the next deal. Some folk are determind to get their price even if it means waiting for the market to rise to meet them.
Simon

 

[Indifference]

Firsty, I am an absolute novice investor compared with everyone who has posted here already, and the best 'discount' as you call it that I have managed is about 20%. That said, I have also paid asking price because it was fair market value and about 7% less than the previous contract which fell over.

In my limited experience, I don't really care what the vendor wants and what the asking price is. I do my own calculation (from research) and work out what the property is worth and determine what I am willing to pay. If my value and the vendor value do not match then I don't buy. But, as Simon said, if you wait and the vendor bends to meet the market then maybe it is a possibility again. If not.... move on to another one. There are millions to choose from.

But as I said, I have very limited experience so maybe this doesn't make sense... but it does to me.

 

[kathryn d]

The best offer we placed was at 50 % of the asking price. They countered to 75% of the asking price. We accepted.
Unfortunately, we had to pull out of the deal.
The mortgage was too small for many lenders, but looking back on it now, I don't think I'd have the same difficulties. I have learned a lot since then.

We also looked at about 10 other properties on the same day.Put in offers on 2. They one we ended up buying we offered 18% less but they accepted 12% less.

 

[oc1]

Hi Brenda

The best discount I have got is 35%. I then onsold at 95% value to an investor settlement same day

Oscar

 

[Annie]

I once offered 30% below asking (& got it!) because when I looked at the property, it seemed to be a divorce case (bedclothes on the lounge & a guy's clothes stuffed behind the lounge still on hangers, instead of in the wardrobe were a few clues!)
I think you have to look carefully at 1) the current market for the area, 2) how long the house has been for sale & 3) do a bit of detective work into the reason for the sale if you can before deciding how much below asking to start at.
At the end of the day, the worst they can do is fall about laughing at your offer!:
Annie

 

[Bargain Hunter]

But as I said, I have very limited experience so maybe this doesn't make sense... but it does to me.

Hi Indifference,

No matter how limited or otherwise your experience, your comments show a mature attitude to investing. If the numbers say go you do, if not you move on.

From your post you have at least two properties which both meet your criteria. Great work for a novice.

Regards

Andrew

 

[Rickson]

Our best deal ever, we paid more than asking price. About three years ago, old listing. Had been in the back of an agent's book for a long time. We asked about it and offered the asking price. They said no, but for about 10% more they would sell it, because it was an old listing. They did not live in the local area.

This was the most instant equity we ever made.

 

[jahn]

Hi Brenda
The 1 bargain we got, we finally got out of "after" we said yes. (due to some buiding problems and water drainage probs), and the others were purchased during the rising cycle, so not so good in the offer stakes yet, but from what I've read, you might be able to tell us what some of your best results have been?
jahn