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Posted on 01 February 2022

How to negotiate your house purchase

Have you found a new home you really like yet, have no idea how to put forward an offer? Don’t worry, we have you covered!

Suprised child holding a notebook

Wondering how to negotiate your house purchase? The experts at Exchange Train have some pointers to help you along.

The Perfect Price

Nothing beats the buzz of finding the place you want to buy and let’s face it, the first thought you have when you find the perfect house is “great, but can I get it for the perfect price?”

Well, we spoke with our founder (and former estate agent) Alex Beagrie to discover whether he had any tips and tricks when it comes to price negotiations.

Inside Knowledge

“There are so many ways you can approach property negotiations. The one misconception I found was that a lot of buyers kept their cards close to their chests. Not only with the seller, but with me as well! I couldn’t stress to them enough that I wanted to make the deal happen as much as they did. (Preferably because I could get my commission but that’s beside the point).”

Alex continues, “Understanding the buyer’s true financial limitations enabled me to strategise the negotiations to get the best for both parties. Although the seller is technically the estate agent’s client, we need to satisfy both parties to complete a sale.”

Tips and Tricks

The bullet points below summarise the rest of our thoughts and we hope you use them to your advantage:

  • Be honest with the agent about your financial position
  • Start low and work your way up – reducing an offer damages trust when it comes to negotiations
  • Don’t be afraid to lowball it, what’s the worst that’s going to happen – they say no?
  • Ask your agent why they are selling to get a sense of the urgency. (They may be willing to take a price hit to accommodate a fast transaction)
  • Cash is king – if you’re a first-time buyer, have no chain or are paying in cash use these items, the risk of the deal falling through minimises dramatically and makes you look more attractive.
  • Go to Rightmove and look at similar houses in the area and what they have sold for. Don’t simply use the list price to determine your offer, make an offer based on what you feel the property is worth.
  • The three-offer rule – your first offer should be your “I hope we get it for this price”, your second should be “this is what I’m comfortable with” and your third is “I would categorically not pay any more than this.”

The Offer

Now, the actual process of putting forward an offer isn’t actually spoken about that much. We feel it may be beneficial to explain how this works and, the good news is, placing an offer is very straightforward.

All you need to do is call up the estate agent and give a figure. The estate agent may ask to see ‘proof of funds’ if you’re a cash buyer or your mortgage ‘Agreement in Principle. This is standard practice to make sure you can afford the property at the price you’ve offered. Now comes the nail-biting part…waiting for your offer to be accepted. Hopefully, the current owners won’t keep you hanging too long. Once your offer is accepted, you’ll need to find a solicitor to help you take the next step towards picking up the keys to your new home.

After your offer has been accepted you can “Get a Quote” and choose your conveyancing solicitor!