What is your buying strategy?

M

mandimoo

Hi guys,

Last Tuesday a property came on the market, I called immediately and made an appointment, viewed it on Thursday along with other people. They were talking to me about it, I tried to talk down my interest. On Saturday I took my family through and they all approve. We did not make an offer still as we knew that another person is viewing tomorrow morning. In our past experience when a RE shows people through a house they always tell them they already have an offer on it and this pressures them into making a decision right away. For this reason we have been waiting it out until after the person views tomorrow morning. I know that after we make the offer the RE will probably call everyone and tell them that we have anyway. The place is a mortgagee sale due to death and the beneficiaries will get the leftovers.

How would you go about making the offer trying to both get the best price for yourself but making sure that you secure the property and do not get outdone? The asking price is 410 but was first advertised at 395, not sure why it was changed. We have a plan for this place that fits in with our current investments, this plan will not be possible with other properties so it is quite important that we secure it.

I am usually really bad with offers either offering too low or going in with asking price (like I did with our PPOR) because I dont want to miss out. :confused:

Thank you!
Amanda
 
If its for your ppor and ticks all the boxes why dally around? Make your offer and secure it. Do a short settlement so the beneficiaries can get their cash and move on.

Put in an offer at say 375k and see how it goes. Its not so far off 395k to be laughable
 
Amanda - is it in Perth?
I would put my offer in sooner rather than later with a short expiry on it (24-48hrs). That gives the RE less time to get offers off the other people - if he can.
I would offer somewhere between $380-395. It really depends on how important it is in your portfolio.
 
depends on the state of the local market. If loads of interest - putting in a low ball offer could mean you miss out.

Other suggestion of short settlement (if possible) is a good one, as the beneficiaries would most likely want it closed/finished quickly.
 
When making an offer on a property I make sure the same steps are followed everytime.

1. Really really really understand where the price should be.
To do this: Get a 3rd party valuation;
Go and see as many comparable properties in the area;
Talk to the agent and get the best possible indication from them.
​
2. As soon as I'm confident with price I'll move onto Settlement time. Talk to the agent about this; find out the vendor's situation, if they've bought already, if they need to sell, is the property currently let or is it vacant. Get an idea of the true time scale they find ideal.

3. Once I've established price and time it's then about conditions. See how they feel about your usual clauses such as inspections, finance, prior access, chattel warranty and the like. Once you know these three points then move onto making an offer.

4. Make your offer. It's not all about price. If you want to pay less (try and get a little bit more than the average discounting than that of the area) then give the vendor the best time and terms possible. The strongest offer is usually a 30 day settlement, unconditional one. Don't muck around here with emails and talk... just get the agent a signed contract and vendors statement. Boom.

5. If you can't offer the best terms because of your own situation then you'll have less bargaining power with price. Don't be ridiculous and knock 10%+ off of the quoted price if your terms are loose.

6. ALWAYS put in a time period. I usually make my offers with a 4 hour expiry. If they honestly tell me it can't be done I'll make it 11:59pm that same day. As an example I just bought a property today for a client. The offer was put in yesterday with a 4 hour deadline. The agent couldn't meet the deadline so I said make sure a signed copy is in my email when I arrive to work this morning. It was.

7. With investment properties always include an 'access prior' condition and a 'chattel warranty' condition. They are unrestrictive to the sale and make sure you're playing smart.
 
Hi Jake,

Is access prior for us to get access beforehand? I have tried to get this with our two previous IPs and been unsuccesful. Vendors wouldnt even let us in to get our stuff done when our settlement was delayed by 1 day (happened both times)
 
That's right, it's so you get access "x" days before settlement so you can get tenants in, plan renovations, get quotes etc...

If you put it in the contract the vendor can't say no... and if they do a quick call to your conveyancer will sort it out. :)
 
Jake Milne said:
That's right, it's so you get access "x" days before settlement so you can get tenants in, plan renovations, get quotes etc...

If you put it in the contract the vendor can't say no... and if they do a quick call to your conveyancer will sort it out. :)
Click to expand...

If its unconditional can u actually do minor renos such as exterior paint, fix deck etc
 
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