The process of negotiating a sale price on a property can be a delicate balance between what you want and how much you are prepared to let it go and for how much.
If you have made an offer in good faith – and are a buyer who is chain free, with a mortgage lined up and the offer is reasonable, it can be frustrating to be turned down by a vendor and be faced with a counteroffer to consider.
Vendors like to get as much money for their property as they can – however, holding out can mean they lose the chance of selling quickly and to a buyer who will see the sale through.
Here are a few tips for handling counteroffers and getting your ideal property at the price you want to pay.
The fact that a counteroffer has been made is actually positive news, rather than an outright rejection – which may suggest another buyer is in the running or other buyers are perhaps not in such a strong position to move forward (eg they may be in a property chain themselves).
If an estate agent is handling negotiations, it is best to send an email your response, so it is on record – alternatively if you are negotiating with the vendor directly, email your response to them.
If the counteroffer is clearly above what you can afford and you cannot access any more funds, the best thing is to decline it outright and say your offer was made in good faith but unfortunately it is your final offer. You could at this point stress the strength of your position as a buyer (eg no chain, mortgage offer in place, ready to complete quickly), as well as any the cost of any repairs or refurbishments you might have to make to the property if you buy it – and then wait and see if there is a further response from the vendor. Once that a counter offer has been made, you cannot revert to that offer, however, but you can withdraw. However, if you are still set on the property, then you need to increase your offer – which is exactly what the vendor is hoping for.
If the property is well below your budget and answers most of your needs, or you need to move house fast – you may want to secure it. However, your next offer must be on condition that the property is removed from the market immediately and no further viewings take place.
This not only secures your position in case another buyer comes forward, but also leaves negotiations open – the vendor, for example, may come back and say they will remove the property from the market and cancel viewings if you increase your offer again and they may make another counteroffer.
At some point, one of you is going to stop negotiations – and it may be that you feel panicky about declining this counteroffer. Saying you will get back to them after you have thought it through and leaving your response for a day or more can put your vendor on the back foot, but it will take some nerve if you are frightened of losing the property. The best way to spend the time is go and view some more properties while you are making up your mind – as this will also help you think more clearly and you might find something you like better, or your vendor might contact you and agree to your conditions.
If you do decide to go back with another offer, try and meet the vendor halfway – and say you have been viewing other properties and feel this is your final offer, but stress the property must be removed from the market immediately and all other viewings cancelled if they accept your new offer.
If the vendor declines, it may be time to withdraw – this can be hard to do, but it is not always the end of the game. Respond by saying you are sorry you could not meet their expectations, but that you are still looking and hope they manage to find a suitable buyer.
Keep an eye on the property – however upset you are at losing it, it will pass and quite often property sales can fall through, so you might find it taken off the market, only to return at a later date – if you are still looking and interested, this is a good time to strike a deal with the vendor.
Once a counteroffer has been made and you’ve had an offer accepted on a property, the next step is to find the right conveyancing solicitor firm for you.
Peter Anderson – Conveyancing and property is a favourite topic of mine to blog about! Google+