[Closed] Strategy for outbidding rivals on a house purchase

It's a blind auction. You're blind 🙂

You'll just have to bid what you think it's worth to you. It's a fool's game trying to work out what the opposition will bid and the Estate Agent certainly can't be trusted - he'd be unprofessional to tell you anything but if he's going to be unprofessional then he'll probably try and bid you up by telling you someone else is making a higher offer than they actually are.

What clubber says - you just have to ignore the other two buyers & bid what you are happy to pay end of, you will certainly find out if you under bid, whether you ever find out if you have over bid is another question.

Yes, that's the challenge. I'm still going to ask him straight re whether B have upped or not though.

If there were houses coming on every week I'd be less intense. But there's literally one every 2-3 weeks.

I've just done what you're doing but from the other side. The whole point was that none of the 6 people offering knew what others were offering 😀

Arent we meant to be in economic meltdown and you are looking to bid over the asking price??

When is the housing bubble going to burst then?

That's the difference between the country-wide situation and the local one. Round where my place is, anything decent moves very fast as very few people are selling.

@clubber: yes, I know this goes on all the time when the market dictates - I'm just looking to gain an advantage. No harm in that.

you are looking to bid over the asking price??

I'm sure plenty of people have bid over the odds to secure an offer only to negotiate down (based on MV or surveyor report etc) or even pull out.

I'd be trying work out the same but the reality is that unless you bug the estate agent/seller, there's nothing you can do.

This Is exactly why house prices go up and up and up. and it Is making it unrealistic for first time young buyers to buy houses. The asking price is as high as anyone should go End of story. First come, first serve basis.

No it's not. prices go up because people are willing to pay more. The asking price is only a notional figure by definition.

Arent we meant to be in economic meltdown and you are looking to bid over the asking price??

pretty much the norm in Scotland.

Try buying in Aberdeen, no meltdown here.

If there were houses coming on every week I'd be less intense. But there's literally one every 2-3 weeks.

£20k over the term of a mortgage is going to cost you in the region of £100/month extra. That's £1200/yr every year....

I wouldnt be suckered into paying £100/month for e bloody long time, just to make sure that I got a house. You say yourself there are houses coming up every 2/3 weeks. I'd be going low with this one and not quite so low on the next one then one day i'd be getting the amount just right.

We recently viewed a house at £375k asking.

We politely withdrew our interest when asked to submit a best and final offer because we knew already that there had been a bid of £425k on the property (our mortgage adviser found this out).

Ended up buying a house marketed at £425k and got it for £392k.

houses coming up every 2/3 weeks

What I stupidly forgot to add was that none of them are right for us. It's just the number coming on the market.

johndoh, how did your MA find that out? Were they affiliated with the agent?

No it's not. prices go up because people are willing to pay more. The asking price is only a notional figure by definition.

Pretty much. As we know, agents will often start high whereas it's the MVs who are trying to price more realistically so as to minimise the loan/debt.

It's blind, best thing we did was list and sell ours before bids closed (12 hours to spare!!!!) with the same estate agents. because they were getting 2 sales (none of the other bidders were selling with them if at all) they might have been a but naughty and said something along the lines of "all bids are in, yours isn't quite enough..." we upped 10k and we got it (40K over asking, was 3 now only 2 beds)

To this day I don't know if they just rinsed us for 10k or not. I did feel a pang of guilt about it, but it was a rare opportunity for us to have any chance of buying in the area we wanted and most of the other bidders were developers I think.

Estate agents job is to get the seller and themselves every penny they can. Times are tough for them and many will bend\break rules for their own gains (as many many people do in all other walks of life)

Good Luck!

[i]pretty much the norm in Scotland.

Try buying in Aberdeen, no meltdown here.
[/i]

Also in Scotland (the bottom end) and houses ain't shifting unless the price is 'right', rents seem to be going up though...

if you lose the bidding battle chances are the winner will pull out when he finds he has overbid.

This happened to me, I blame the greedy vendors - I offered the full ask price in cash & was told to submit my highest bid, I reduced my bid by 10k & lost the bidding battle.

1 mth on, the property was remarketed as the winner pulled out.

I am so glad I lost out - I bought a real peach at similar money.

pretty much the norm in Scotland

Buying in Scotland can end up just being a guessing game. We bought our house in Scotland for £22,000 above the 'offers over' price. £17,000 over it was not accepted, so I've no idea how they set the 'offers over' price when they were never going to take even that much above it?

Someone else offered £32,000 over the 'offers over' price just before we exchanged missives, but thankfully the seller stuck to his verbal agreement.

Which pretty much confirms that it's worth whatever someone will pay for it.

johndoh, how did your MA find that out? Were they affiliated with the agent?

Bid what you are prepared to pay.

If you get it, great!

If you don't, then there was obviously someone who was prepared to pay more (if you are upset at this point, then you obviously didn't bid what you were prepared to pay)

You got lucky there john!

if you lose the bidding battle chances are the winner will pull out when he finds he has overbid.

Depends on what they can afford and how much they want the house. The reality is anyone can bid high just to get first dibs. Immoral maybe, but also a tactic that can no doubt work.

depending on the work to be done to the property get a full survey and then try to knock them down afterwards if you expect issues.

we knocked ours back down 10k in the end on some of the hidden horrors we found after the full survey, they'll usually only move if the issues found weren't in plain sight.

we found completely bug riddled rotten floors and damp hidden behind sheets of plastic and ply on some of the walls 🙄
all hidden/patched over by the old chap that used to live there

We'll be having a buildings survey anyway. Plus the FIL has done some building and he's been round to say it's fine - apart from the aesthetics which we want to replace/change anyway. We're not expecting the report to deem anything as an essential repair so I think it'll be hard trying to negotiate down on that basis. If something is found, then we go down but end up spending the money to fix it.

Certainly did - the MA came recommended though and to be fair she was really very good with none of the bullshit you normally have to sit through with these sort of people. 🙂

I didn't read all of the above but the sellers are being pretty ruthless, why not return the favour? Bid as high as you can go and then negotiate back down again near completion time. Sellers never reveal everything - use this to find new bits that need repair or replacement and lower your offer. You'll be a long way down the process by then and no one will wish to start again...

Btw, I'd much rather we all operate more honestly than this and have a better set of regulations and legislation surrounding house buying...but we don't. At the moment it encourages greed, selfishness and stupidity...

You'll be a long way down the process by then and no one will wish to start again...

Blind bids are not nice and glad I haven't had to do one - having said that I've never been desperate for a particular house as always quite open on location.

But blind bids are probably best were several people are very keen on a property - well either that or open bidding which could be just as expensive. I'm unsure which is likely to give the vendor the best price really as in open bidding people can get carried away and think they can push it up by just another £1k and go beyond their initial max price.

CB is talking about gazundering which is a risky tactic - mostly likely to work in a buyers' market but this isn't the case here.

BTW, on the occasion we were asked to go into a sealed bid situation it made us look at what else we could get for the higher price we would have had to go to and ended up buying the house that we had previously not even looked at as we were looking at lower priced houses and it wasn't even on our radar.

house buying is a right royal pain in the bum - was hoping to move mid July but turns out the front garden on the house I had agreed on actually belongs to the council & the "allocated" parking is nothing of the kind, meanwhile the opportunity to buy another better house has passed 👿 any attempt to bump up prices like "offers in excess of" & sealed bids are a real turn off for me, but then again I haven't found an ideal must have house in my price bracket yet

house buying is a right royal pain in the bum

Given that people are buying things [s]worth[/s] with a price tag in the 100s of 1000s of pounds, all funded by a loan secured against the thing being bought, the whole process is actually remarkably simple.

Perhaps I shouldn't say this but our sale/purchase has been pretty straight-forward so far - hoping to exchange this afternoon...

Btw, I'd much rather we all operate more honestly than this and have a better set of regulations and legislation surrounding house buying...but we don't. At the moment it encourages greed, selfishness and stupidity...

+1 Do our Highlands friends still have to pay for a survey/valuation when selling (which needs renewing every 3 months or so)? Seems reasonable to me although I think people should pay less for each successive report.

Bid as high as you can go and then negotiate back down again near completion time. Sellers never reveal everything - use this to find new bits that need repair or replacement and lower your offer. You'll be a long way down the process by then and no one will wish to start again...

Yep, we've thought of this even though it's not exactly playing ball.

Gazundering is a pretty scummy thing to do IMHO. If someone tried it with me, I'd pull out immediately.
Just bid whatever the house is worth [i]to you[/i]. That way you're not going to be irked if you win it, nor too upset if you don't.

Yep, we've thought of this even though it's not exactly playing ball.

Its only not playing ball if the survey comes back clean. If the survey says work needs doinging then its fair enough IMO.

And every survey ever has said work needs doing to electrics etc. 😉

Have you exchanged yet John?

I *think* so.

We are using an online solicitors and they had to ring my wife up to get her authorisation but they were playing telephone tennis earlier.

Yep, exchanged 🙂

Finally I get a garage and a garden larger than a carpet tile!

OP, you seem to be in a strong position in terms of being ready to go, so how about stressing that to the seller by making your offer contingent on early exchange, with a reduction if not

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might do the trick[/url]

I got fed up of playin the guessing game and losing

So next house i saw i started viewing quickly and i played the perfect for raising a family card with the seller and then went back to my solicitor and said - ask them how much to take it off the market now (2 days after it went on market) they said 5k extra and i said deal.

Previous offer i put in on another house that went to closing in february last year i lost out by 80k - and i was already 8k over asking!

ask them how much to take it off the market now

I asked the agent the same thing last week and he came back with "... the vendor won't name a figure ... he wants every interested party to submit their highest/final offer."

so how about stressing that to the seller by making your offer contingent on early exchange, with a reduction if not

That could be a plan. I'll see how land lies in the morning.

Yep, exchanged

Finally I get a garage and a garden larger than a carpet tile!

Nice one John 🙂 Garages can make so many jobs that much easier.

BTW, just had our offer accepted. Went higher than we'd like but not as high as our cap. Needs a fair bit of work so projectmonkey mode now engaged 🙂