Advice: Buying an house

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fdaniels

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The property is currently being listed for R1m on privateproperty. We went for a viewing recently and liked the place. The estate agent says that it was priced a few hundred thousand rand more but didn't get any bites. Now that the price is lowered there is apparently a lot of interest.

When it came time to put in the offer to purchase the agent suggested that we put in an offer higher than the current asking price as she is going to see more potential buyers and the seller is going to go with the best offer (obviously).

I stuck to my guns and put in the offer at R1m. The question now is should these other potential buyers surface what is it going to be like? What sort of increments should we increase the offer by? How do we know that there really are other buyers out there?
 
Estate agents are sharks. That's all I'm going to say about that.

Last time we were looking to buy I noticed in the fine print that the agent was getting almost 50k...and that's just for showing us the location of the house, after which the owner did the rest of the talking.
 
Don't bargain at all.
Decide on what YOU want to pay for the place, and offer that and nothing more. Don't get fooled into the "there's loads of interest" BS - that's just to get you to make a deal ASAP.

No incremental bidding if its not an auction!
 
Offer what you feel it is worth in the current market, If you don't get it keep shopping around.

The agent most probably had to drop their fees for the new price and is now looking to make up for that loss.

Just because there might be other offers does not mean that they qualify for the loan, or they might have conditions on the sale of their house etc.
 
Remember this, there is another place that will be better than the current one.

Make your offer and stick to it, if you do not get it move on. Incrementally increasing your bid is a good way to get ripped off, as for there being more potential buyers, so what ? potential does not mean actual and estate agents take a very rosy view to any situation. Even after dropping the price it can mean that the property is still overvalued.

The value of a property is determined by how much someone is willing to pay, not by how much the seller wants.
 
Thanks for the advice guys! I really appreciate it.

Yeah I figured the agent was trying to make more money out of us.
 
Ask the agent if there is any other offers already in. If your offer is the 1st written offer, you have right of refusal, meaning if anyone submits a higher offer, you allowed to counter it.

Dont believe the agent, the higher he sells it, the more comm he gets!
 
biena said:
Remember this, there is another place that will be better than the current one.
Click to expand...
+1000000000

NEVER EVER be desperate to to property/car. NEVER.

Like everyone has said, the agents are a bunch of crooks. Do NOT fall for their tactics.
 
The list price was R1m and you offered R1m?!?!?!

Are you mad?

The agent was talking complete bollocks.

I would have offered R900k and worked from there tbh...
 
B.O.F.H. said:
The list price was R1m and you offered R1m?!?!?!

Are you mad?

The agent was talking complete bollocks.

I would have offered R900k and worked from there tbh...
Click to expand...

+1

Never offer the list price! At least 10% less - I would have gone for R850 and see if they bite.
 
If you're serious about a property, pull a property report and see what it's worth, and what the houses in the area are going for.
always offer less than the initial amount.
Also find out what the municipal valuation on the property is.

JHB municipal valuations : http://ims.joburg.org.za/joburg/
PropIQ for property report.
 
Fuma said:
1st time buyer maybe?
Click to expand...

I was a first time buyer, and I didn't offer list price, Hell I was horribly cheeky, the house was on the market for R1.15m... I offered R900k..

Got the house for R950k at the end of the day.
 
Some of you guys don't see things from the sellers's perspective. Not everybody is trying to make a quick buck. Sellers have to factor in agent's fees, cost of renovations, recovering initial capital expenditure etc. They then instruct the agent to list the property at the list price.

If you list it too high to allow for price negotiation, nobody bites. If you factor in price negotiations and list it at the selling price, then people still want to bargain, and the seller makes a loss. And it's not like house prices have skyrocketed in the past few years, so any profit is usually very minimal.

Jeez, if you want something and provided that there is nothing wrong with it, then just pay the damn price. If everyone did that, then we wouldn't have this convoluted mess where nobody actually knows what a property is worth.
 
Mike Hoxbig said:
Some of you guys don't see things from the sellers's perspective. Not everybody is trying to make a quick buck. Sellers have to factor in agent's fees, cost of renovations, recovering initial capital expenditure etc. They then instruct the agent to list the property at the list price.

If you list it too high to allow for price negotiation, nobody bites. If you factor in price negotiations and list it at the selling price, then people still want to bargain, and the seller makes a loss. And it's not like house prices have skyrocketed in the past few years, so any profit is usually very minimal.

Jeez, if you want something and provided that there is nothing wrong with it, then just pay the damn price. If everyone did that, then we wouldn't have this convoluted mess where nobody actually knows what a property is worth.
Click to expand...

Its a negotiation.... If the seller wants a specific price, then why do they accept the offer at a lower value?

And as a buyer, I don't care about the sellers financial standpoint AFTER the transaction, that is their problem not mine.
 
B.O.F.H. said:
Its a negotiation.... If the seller wants a specific price, then why do they accept the offer at a lower value?

And as a buyer, I don't care about the sellers financial standpoint AFTER the transaction, that is their problem not mine.
Click to expand...
Well that's my point, they probably marketed it at a higher price anticipating a negotiation. How does one determine the value of a property in that instance? You could look at property reports, but that's not a true reflection because it doesn't factor in property booms and slumps, inflation, cost of renovations at the time etc. - it's basically just a historical list of what the property was previously purchased for.

And when the time comes to sell, you will start caring and see how annoying it is to find the right balance because of the discrepancies of house prices in your area (some people listing higher and some people listing at selling price). You then have to deal with all sorts of questions as to why other houses in your area are priced differently. Ideally what you want is for both sides to be happy - the seller wants to recover their costs and the buyer wants a good deal. That can't happen in the current environment when a property's value cannot be reasonably estimated due to a lack of uniformity.
 
Oh I understand that when I become a seller it will possibly be annoying, but I will know what my house is worth as an average by looking at selling prices in the area for similar properties over a set period of time.

I will apply whatever tricks I can to make the house more appealing and get more money for it... but I will also have a lower price that I will accept at worst, and not sign offers below that value.

But given that there is no uniformity in houses, you can't expect house prices to be uniform, even in a specific area.

For instance, I have a 4 bedroom home with all sorts of extra...and the almost every other house in my road are basic 3 bedrooms... how would I value my property (even if there was no over pricing at time of selling)
 
B.O.F.H. said:
Oh I understand that when I become a seller it will possibly be annoying, but I will know what my house is worth as an average by looking at selling prices in the area for similar properties over a set period of time.
Click to expand...
Wouldn't that entail getting a property report of every house in your area? Surely that's not financially viable.
 
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