When it comes to knowing how to negotiate house price rises and discounts, there is no silver bullet. All property sales are different, so you might find there is no wriggle room, no matter your experience or 'know how'. To negotiate house price discounts there are a few simple steps to put you in the best possible position to get the right price, however.
You can apply for a mortgage deal before you put in an offer or even before you find a property.
If the lender accepts your application, they let you know how much they are willing to lend you. This offer is called a mortgage in principle.
When you buy a house, estate agents and sellers take your offer more seriously if you have a mortgage in principle because it proves you could afford the property.
This helps your bargaining position when it comes to negotiating house price discounts, because the seller is more likely to accept your offer than one from someone without a mortgage in principle.
You can compare mortgage deals now and apply for the best one before you put in an offer.
Compare residential mortgages if you are buying a home to live in yourself
Compare buy to let mortgages if you are buying an investment property
If you need help choosing the right deal, a mortgage broker can help you decide and speed up the application process.
Ask the agent how many viewings the property has had and whether there have been any other offers. One of the key aspects of how to negotiate house price discounts is demand. If there has not been much interest, you can comfortably offer a lower bid when you start negotiating.
Check when the property was first listed on the estate agents website, or property websites like Zoopla. The longer that the owner has been waiting to sell could mean that they are more willing to lower their asking price.
If the property has had lots of viewings but no offers, ask the estate agent about why and use this knowledge to your advantage.
You could even get a valuation of the property from a chartered surveyor or valuer.
You have to pay for this service, but if they think the property is worth less than the price it is advertised at, you could use this when you haggle. Negotiating house price discounts is much easier if you know the property is worth less than the advertised price.
Knowing the going rate for other properties in the same area is a must when you think about how to negotiate house price discounts on the price of a property you want to buy.
If you can argue that the asking price is above what similar properties sold for nearby you will have a strong case negotiating house price reductions.
Check the asking price of other properties currently on the market and see what they offer in terms of space, features and presentation.
If you think the property is overpriced mention it to the estate agent — they may feed this back to the owners, who may decide to drop the price. This could save you the hassle of working out how to negotiate house price reductions.
You can usually tell quite quickly if you like a property. However, if you are interested you should not get swept away with the excitement of finding somewhere you would want to live.
Any flaws or work that needs doing represent an opportunity to knock some money off your offer price. Inspecting a property, inside and out, can give you the ammunition you need to negotiate house price discounts.
Estimate the cost of any work required and take this amount off your offer price — you will be justified in doing so.
You should also find out whether there are likely to be any major expenses in the near future:
Ask when the boiler was last serviced
Ask when the roof was last repaired (or resurfaced if it is flat)
Ask when double glazing was installed
Decide if parts of the property need to be redecorated
If work is likely to be needed in the near future, you have a legitimate reason to begin negotiating house price discounts.
Not all buyers are equal in the property market. If you are a first time buyer, paying in cash or have already sold your home, you will be a much more attractive buyer than someone waiting on a long property chain.
Let the estate agent and owner know that you are a desirable buyer and you will have more weight when haggling over the asking price.
All homes must now issue an Energy Performance Certificate (EPC) to let you know exactly how energy efficient a property is and what needs to be done to improve it further
EPCs can also be a handy bargaining tool. If you know that a property is only half as energy efficient as it could be, you could ask that the costs of improving this be factored into the sale price.
There is no harm when you are looking around a property or haggling over price to indicate that you are also interested in another property in the area — even if this is not strictly true.
Estate agents often imply that there has been lots of interest in a property to try to force a buyer's hand, so letting them know you have several other options may mean they are more open to negotiating house price discounts.
It may be that you have to put in an offer on a property before you can work out how flexible the seller is.
Put in an offer below what you are actually willing to pay
This will then allow you to up your offer at a later date, which will seem more attractive to the seller
Explain your offer: state exactly what work the house needs and how much it will cost
Mention if nearby properties of a similar or higher standard went for less than the listed price
Explaining your offer shows that you have not simply plucked a number out of midair, makes the seller think twice about their valuation, and shows you are serious about purchasing the property.
If the person selling the house is not willing to budge on price, you may want to haggle over the additional costs you face when buying.
Asking that the seller contributes towards these fees could be a good way to cut the cost of purchasing the property and save hundreds or possibly thousands of pounds — even if you do not manage a reduction in that actual house price.
You could also ask for certain things, such as curtains and appliances, to be left by the current owners to reduce your set up costs even further.
To be sure that you can borrow the amount of money you're likely to need to buy a property, you can apply for a mortgage in principle. We look at what you need to be prepared for to get your agreement in principle right first time.Read More