| How to Determine What to Offer on a House

Finding the home you want is a good starting point. The next step is crafting an offer that enables you to secure the home at a price you are happy with.  

Before you submit an offer, you need to do some research and work out how much you should offer.

You want to get the home at the best price possible, and the vendor wants to achieve the highest price they can.   This is all part of the negotiation game.  

 Although price is not the only factor to consider in your offer, it is definitely the single most important.

Asking the vendor’s agent for advice on your offer will not help you.  Remember their most important goal is to achieve the highest sale price for the vendor, which in turn increases their commission.  Having said this, asking the agent for what they think is a “fair price” is a good idea. 

If you are using a Buyers Agent, you will have a professional on your side who will not only do all the research for you, but also is the best person to negotiate the best possible deal for you without all the emotion. 

Following are a few tips to help you.

Research the “Comps” (short for comparables)
Researching recent sales in the same area is the best place to start when looking at what to offer on a home you like.  When looking at these comparisons it is important to ensure that you are comparing with homes of similar:

  • Size, 
  • Land, 
  • Rooms, 
  • Facilities, 
  • Condition, 
  • Age and 
  • Position.  

It is also important to only compare with sold properties.  Only sold properties reflect the true price.  A property is not always worth what owners want for it – But it is always worth what buyers will pay for it.

If you are using a buyers agent they will be able to access detailed comparison information.

How long has the home been on the market?
Also known as “days on the market” (D.O.M.) – is another important factor to consider.  The number of days the home is on the market is directly related to how hard you might be able to negotiate.  No seller wants their house to sit on the market for too long.  The longer the house has been on the market, the more aggressive you may be able to negotiate.  Do your research first, as not all sellers are in a rush to sell.

What Condition is the Home in?
A home that is ready just to move in and “live” is more likely to receive higher offers than a renovator or a home that needs work.  Although some people are happy and enjoy this style of home.  Most buyers prefer not to have to deal with a renovator.

Get a qualified professional to check for structural and other serious issues that may affect the offer you submit.   A good buyers agent will be able to request a disclosure document from the vendor which discloses any potential issues.

Decide How flexible are you on Price?
If you don’t have much room to move within your budget, you can also use other negotiating tools to entice the seller by sweetening and being flexible with your offer. For example

  • Different contingencies
  • Length of settlement
  • Repairs
  • Rent back options

 


Disclaimer:  Although all care is taken.  We do not give any warranty whatsoever to the accuracy of any content.
This is not meant to be financial or professional advice and is only of general nature.  You must seek professional advice before taking any actions. The above information comes with no warranties whatsoever.  We take no responsibility for any actions you may or may not take. All content is of general nature only and is NOT to be taken as advice whatsoever

Gino Sotto

Residential Sales Agent
Raine & Horne Parramatta

P: 0426 228 014
E: gino@rhparramatta.com.au
W: raineandhorne.com.au/parramatta

TESTIMONIALS:

Gino’s professional attitude and friendly nature was a breath of fresh air.  Thank you for your support and professionalism throughout the sale of our property.  Appreciate the extraordinary lengths you went to to achieve an outstanding result!
Jeanne Appleton, Northmead. NSW

Excellent communication and great confidence when negotiating with buyers. Gino focussed his attention on achieving a sale price well above our expectations. Well done Gino and your selling team.
Ralph and Maryanne Pasero, Rydalmere NSW

I found the sales team at Raine and Horne Parramatta a pleasure to deal with. Their expertise and continuous updates in selling our home was outstanding. Great work Gino!
Rochelle and Casba Webb , Parramatta NSW

A genuine performance-based selling agent Gino Sotto helped us achieve a quick sale, which saved us a lot of time and money. We would not hesitate recommending Gino & his sales team to others.
Lawrence and Kim Davies . North Rocks NSW

We were delighted with Gino Sotto and the sales price achieved for our house and the specialist approach to selling residential real estate in our area.
Danny and Manal Ayoub Merrylands NSW