Making an offer on a property

YOU really want a property and are keen to put in an offer but where do you start?

No one wants to pay more for a house than the market value, so how do you get the best deal? What is the magic figure to start the negotiation process?

Making an offer on a property is similar to playing a game of chess — each party waiting to see what move the other party is going to make.

What is the process?

The process of making an offer on a property can vary from state to state.

For some areas, the first offer can be verbal, for others it is written.

The negotiation process begins when you first meet an agent.

Open for inspection

During this process and before you make an offer remember the following:

Have a clear understanding of the process.

Know what price you want to pay for the property and work out your strategy to accomplish this.

Research the property fully and ensure you’ve satisfied all your requirements.

Have an understanding of the vendor’s motivation to sell, their preferred settlement date and any other information that may make your offer stronger.

Remember to be patient. Some property offers can take a while and they can be stressful. Don’t rush offers if you don’t need to and consider putting a time limit on any offers you do make.

Do your research

One of the biggest mistakes buyers often make is not researching the property fully before making an offer.

Speak to the agent to get an idea of the vendor’s asking price.

Study other comparable properties that have sold in the area recently, which will help you determine how much you think the property is worth and make an informed offer.

If you’re interested in a property that is going to auction, ask the agent if the vendor is considering pre-auction offers.

Be upfront if you’re interested in the property.

How to offer at auction

Making an offer on a private treaty can be done in your own time, but an auction is different.

Auctions can be emotional, so you need to keep cool under pressure.

To get an idea of how these play out, it’s a good idea to attend numerous auctions before ‘the big one’.

This way you can check out strategies used by other buyers.

Before the day, have all your inspections, terms and conditions, etc, completed and checked out by your solicitor.

On the day, know what you want to pay for the property and don’t deviate.

Remember, deposits are generally 10 per cent of the purchase price so ensure you have funds available.