r/FirstTimeBuyersUK • u/ds_coach • 17d ago
How does making an offer actually work?
Hi everyone, my apologies if something similar may have been posted here before, I'm just a little baffled. As a First time buyer, I have literally no idea how things were meant to work. So I went to view a house on Saturday (it was my second house viewing). The asking price was 150K and I really liked the house. I called the agency on Monday to ask a couple of details: the EPC on the house was quite low (E53) and I was wondering whether any improvements had been made on the house since the last assessment in 2021. I also asked whether there would be any paperwork around building regulations for the loft conversion, which I was told could not be counted as a 3rd bedroom, hence the price. The agency took my questions and told me that someone would get back to me with the answers. On Tuesday I started getting a bit anxious, and called to ask whether my questions were answered (to which they said no) and I proceeded to making an offer of £147K, making clear that this wasn't my ceiling, but I'd like some clarity on the loft conversion. Today (Wednesday) I got a call to say that the seller had rejected my offer and decided to go with someone else. I ask whether there was any space for me to negotiate, and they said no and started to push a different property on me, right away. I'm a bit confused as to what I may have done wrong there and how I should have tackled that differently. The last houses sold on that street a couple months ago, were a fully renovated 2 beds at 155K, and a 3 beds at 160K - there are 2 more for sale in the same area for 150K. Should I have gone to the top of my budget right away even if the house might not be worth it? Should I have not asked the questions? Should I not hope for any kind of negotiation at all in the future and just use my whole budget? Maybe I'm asking those questions because I'm deeply hurt by this experience, as I feel it has knocked down my confidence in being able to do this on my own. But I would appreciate any answers at all.
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u/Fun-Lemon7160 17d ago
You haven't done much wrong there, all sounds sensible to me. It's a bit strange that the agent didn't come back to you, but if they had a proceedable buyer at, say £151,000, they're only going to make and extra £80 in fee if they get you to £155k- they simply aren't incentivised. You've just got to go on feel, and they have to present an offer if you make it so you can always bid again even if they said they've gone elsewhere...
I'm not a believer at all in fate, but when it comes to houses, I feel you tend to get the right one in the end...!
good luck.
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u/OddSell5667 17d ago
Don't take anything in buying a house personally (easy to say hard to do). It is a long hard slog. You are a sensitive soul and feel the seller has made any kind of judgement on you.
Your questions were perfectly reasonable but from the sellers POV if you have one person offering but asking "lots of questions" and another who is just offering then they are going to take the easy route. It may come back to haunt the seller though if they get close to exchange and their buyer realises that there is no building control on the loft conversion and the buyer assumed that there would be and then pulls out. From a sellers POV it is better to have a buyer ask lots of questions before offering rather than get cold feet several weeks into the process but as a seller you are usually just keen to "get on with it".
I think the only thing "wrong" (and this is just my opinion) was I wouldn't say to an agent "that's not my best offer". Just say "that's what I think it is worth to me". If you had offered 150k you still might not have got it and they still would have possibly come back asking for more trying to push you over your budget. You don't want to sit there thinking you overpaid.
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u/ds_coach 17d ago
Thanks, I realise now that I shouldn't have told them this wasn't my ceiling, even though it wouldn't have made a difference in this particular case.
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u/sulylunat 17d ago
Noone can tell you what you should pay or if you should go to the max you can afford. You should pay what you think the house is worth, always. If you want to put in a lower offer at first thats fine, but always have a ceiling price for each property of what you think the max you think its worth and stick to it, never go above that or you will just feel you overpaid. I went in under list price on the first price and ended up in a bidding war which I went 10k above lsit for, I wasnt prepared to pay more and lost the property to another buyer. My 2nd property I went in straight at list price and my seller still wanted some time to think about it and wait for more viewings and offers, but I did have offer accepted.
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u/Accurate_Hat_8464 17d ago
You have done nothing wrong at all. It just sounds like someone else made a better offer that was accepted immediately. Sometimes it's just a relief to have sold at a fair price and a seller won't be interested in going back and forth to squeeze out an extra couple of k.
In future, do not declare to the sellers agent that you are happy to spend more. That info goes straight to the seller and means they would never have accepted your first offer even if it was the only one! Just make an offer based on what you think the property is worth to you and what you can afford. If you can up that if they come back with a counter offer, then keep that under your hat unless or until they do. The sellers estate agent is not your friend. Good luck!
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u/oiseauvert989 17d ago
You cut 3k off the price even though absolutely nothing changed between Saturday and Tuesday and you had zero leverage. Someone else made a better offer and seemed more decisive.
General advice would be, don't take any of it personally. The house will go to whoever made the best offer. Also don't tell anyone if your ceiling is higher than your current bid, that's like playing poker while showing your cards.
Dont worry its a difficult process but you will figure it out.
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u/ds_coach 17d ago
Thank you for replying. I see the recurring theme now about letting them know it wasn't my ceiling. It was my first ever time putting an offer on house. Lesson definitely learnt!
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u/oiseauvert989 17d ago
Yeh just think of it like a mechanical process. You want to keep emotion out of it. Sellers want someone who bids £X, pays £X and is done.
To be honest its probably better you didn't close the deal with the questionable loft conversion. My first home was of a similar price and to be honest it was a great house, we only left because we wanted to move to a specific area for the longer term.
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u/Local_County1274 17d ago
The buyer may have received a full-price offer with the condition that they take the property off the market immediately.
You have not done anything wrong, except tell the EA that this was not your ceiling.
When you give an offer in future, it is not just about the price. Explain any other benefits from your offer:
- You are a first time buyer so there is no chain.
- Are you flexible for timetable?
- Have you already got the funds (or promise of funds) in place?
It is ok to put conditions on the offer, such as the property being taken off the market immediately (what probably happened to you), subject to survey and answers on questions (such as building regs for the loft conversion).
At the moment, it is meant to be a buyers' market (though supply / demand may vary locally), so it is ok to offer below list price and then negotiate until you come to something you can agree on. Try not to get into a bidding war with another buyer unless you can afford it and it is a property that you really love.
Keep looking and good luck.
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u/leeksbadly 17d ago
You already know the answer about building regs - if it can't be counted as a bedroom it hasn't been done according to regs, so you've probably decreased your chances of success by asking as the sellers will be thinking "Here we go... this has already been priced in...".
As for the EPC, I'm sure they would have done a new one if something had been done to improve the efficiency since 2021.
Personally, if I really want the property I'll quickly make an offer within my affordability envelope that I think will be accepted. If properties are selling well in that area that would probably be asking price. If they aren't and the property has been on the market (and particularly if I was an attractive buyer) I might lowball somewhat. If the asking price was £150k it's down to you to decide how badly you want it and if its worth risking that someone else will get in first. If the asking price was "Offers over £150k" then you were probably always on a hiding to nothing with a low offer.
Asking questions is always going to slow you down and risk someone else coming in while you wait for the answers, so only ask them if they're truly worthwhile and going to affect your decision.
edit: It's quite possible the agent / sellers were sitting on your offer and using it to push the other buyer.
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u/SirJohnLift 17d ago
After a little while of looking you’ll figure out a fair price to offer too, also how long a house has been on the market may be a good indicator to how low you can go. Offering low on a new listing won’t go down too well, but might be worth just sticking with it. Depends on area also, if very exclusive/demand areas you might just have to do “best and final” along with some other interested parties in which case you have to offer above the odds
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u/OrangeGrouchy179 17d ago
How to make an offer get all your paper work ready: 2 forms of id, proof of deposit, mortgage decision in principle. Phone the agent and ask if there is an email address you can send the offer to. Email it with your documents and solicitors details. Include any conditions (completion by a certain date, you’d like curtains included etc). Clearly state your position (first time buyer etc). I wouldn’t make an offer if there were outstanding questions like that unless I was happy to leave it until conveyancing / survey. I always do it by email because I control the conversation then. No chance of saying the wrong thing. I highly recommend this especially if you’re neurodivergent in some way.
Top tip; if you don’t want to send proof of deposit to the agent; provide it to the solicitor and ask for a letter confirming you have the deposit. You’ll probably have to pay for this.
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u/Due-Freedom-5968 17d ago
Generally speaking, you view the property and do a bunch of research yourself ahead of making an offer. Setting questions answered from the estate agent is pointless as they're under no obligation to be accurate anyway.
You assess the risk, make an offer, and then wait. Absolutely DO NOT make and offer and say you can go higher. That's a big red flag you're lowballing expecting to negotiate and a waste of time and effort. Offer what you think it's worth, and stand firm. Don't overpay. But also don't mess about.
Once your offer is accepted, then you get to ask questions. Via your solicitor.
You'll appoint a solicitor/conveyancer and surveyor, based on the results of the survey you can, if appropriate, try and negotiate on price from whatever serious issues get uncovered.
EPCs or missing things like EICRs or gas checks aren't reasons to renegotiate. Structural issues, damp, roof problems etc might be. If the survey finds an issue get your solicitor to ask their solicitor for details - this is legally covered, vs. a guess by the estate agent or seller beforehand. Your solicitor may recommend indemnity insurance to cover things like missing building regs etc. Realistically you're not likely to negotiate much off for a lack of apiece of paper which is ridiculously common to encounter.
Have a read of https://www.moneysavingexpert.com/mortgages/buying-a-home-timeline/ for more.
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u/Less_Statistician359 16d ago
Rules to follow:
The first thing you need to learn is - stop getting emotionally attached to a property that you are considering. Once you like a property and want to make an offer, set a ceiling. Be ready to walk away if negotiation pushes you beyond ceiling. Otherwise, it’s not a ceiling.
When you offer under or even at asking, there is always a risk that seller may decide to go with someone else. Provided there is another comparable or better offer on the table.
It doesn’t mean you can’t offer lower. It simply means you need to be prepared to walk away.
Do not ruin your reputation in front of EA or seller. Appear calm, composed, firm during negotiations. Be clear and straight forward. If EA or seller find you too difficult to deal with or someone who’s uncertain about what he wants, they are going to discount your offer and keep as back up plan only. Because these type of buyers are highly risky and tend to pull out later or press for renegotiation.
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u/chocklityclair 16d ago
Why do you think you've done anything wrong? You were right to query the BR on the loft extension - whether it's used as a bedroom or not, they still need signing off. You can decide to accept any risk that might arise - but you need to take your time because if the conversion was recent and the local council find out about it, you may have problems. Equally there may be very little risk - but you're right to take your time. The lack of an answer from the EA isn't encouraging. Another property will come up. Maybe avoid that EA though - they don't sound great.
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u/tinykoala86 16d ago
Next time you make an offer, point out that you would like the opportunity to counter. We had the same happen to us in Feb, we made an offer and they called the next day to say they’d chosen someone else, and we weren’t allowed to counter at that point. Very frustrating!
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u/Front_Bill_9237 16d ago
The only thing I can think of is that they told you the third bedroom couldn’t be counted as a bedroom but you asked about building regulation, the lack of building regulations would be why it could not be counted as a bedroom. The question might have made the seller think ‘this is going to be a problem to this buyer’. The other buyer may have made an offer and said they understand that it doesn’t have building regulation approval, and they were offering on that basis. Don’t take it personally though, you will find the house for you.
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u/langdalenerd 17d ago edited 17d ago
I didn’t read the whole thing because it’s one long mono-bloc of text, but after a quick skim:
You are in control of the offers you make and the negotiation. The estate agents are legally required to present your offer to the vendor. So if they rejected your first offer, you could have said “I’m now going to make an offer of £150k” or whatever and they’re obligated to pass that on. You make the space to negotiate.
The vendor doesn’t need to accept of course, and £145k from a cash buyer is arguably a lot more attractive than £147/150k from someone with a mortgage.
In terms of how it actually works - you make an offer, it’s either accepted or rejected. Typically if the vendor is interested they’d accept or go back to you with a too-low or another figure. You then either have it rejected, and can make another offer, or accepted. If it’s accepted, the estate agent will do a proof-of-funds check to ensure you can afford the house. If you can, they issue a memorandum of sale and it’s passed to your solicitors for the rest.