Making an offer
Once you have found a property you like, you know that you can afford it and the bank or building society will lend you enough money, your next step is to make the seller an offer.
When should I make an offer?
Fixed price properties
If a property is advertised as fixed price it means it will be sold to the first person to offer the price. If you see a fixed price property that you like, you should put in an offer as soon as possible.
Offers over properties
If you have seen an 'offers over' property that you like, you should get your solicitor to note your interest. Once the seller has received a few notes of interest they may set a closing date. If you have noted your interest you will be notified of this and you should make your offer before the closing date.
'Guide price' or 'offers in the region'
More and more properties in Scotland are now being marketed with a 'guide price' or asking for 'offers in the region' of a certain price. This is similar to the system in England. Your solicitor can advise you on reasonable offer to make. Looking at what similar properties have sold for recently might be helpful, but also look if any other properties nearby have been on the market for a while, as that helps you know how fast property is selling in the area. As with 'offers over', your offer may be accepted, or the seller might set a closing date to get all interested parties to say how much they will pay.
Fixed price - how much should I offer?
If the seller has advertised the property at a fixed price, then they will usually sell to the first person to offer them the price they have asked for. However, the seller may not accept the offer if the date of entry or other conditions in the offer do not suit them.
If a fixed price property has been on the market for a while, it may be worth offering a lower price than has been asked for, as the seller may be looking for a quick sale.
Offers over - how much should I offer?
If a property is advertised as 'offers over', the seller is inviting higher offers than the price stated. Sometimes properties are advertised at much lower prices than the seller would be willing to accept, in order to generate plenty of interest from prospective buyers. It is difficult to know how much to offer as you won't know what other offers are being made.
Make sure you work out your finances before you decide how much to offer. Remember, most mortgage lenders will lend you a percentage or all of the valuation. If you want to offer more than the valuation, you will have to meet the difference yourself.
Tips for making an offer
- ask your solicitor for advice - they should know how much homes have gone for recently in your area
- don't offer a round number - for example, if you offer £75,101 you may outbid someone offering £75,000.
- find out the selling price of homes in the area through OurProperty or subscribe to HousepriceScotland.
What should the offer include?
Your solicitor will discuss with you the conditions which should be inserted in the offer. These include:
- the property
- the price
- the date of entry
- any other conditions.
The offer will state the property you are buying and give a brief description, usually with reference to the particulars. The description will also list any fixtures and fittings (such as wall-mounted lights) which are to be included in the sale.
The price you are offering will be stated. If you have negotiated with the seller to buy 'extras' not included in the sale (such as white goods, carpets or curtains), these prices will be stated separately.
The date of entry
The date of entry is the day when the money is transferred to the buyer and you can pick up the keys for your new home. It usually takes four to six weeks from having an offer accepted to the date of entry. Talk to your solicitor if you want to arrange an earlier date of entry.
Before you make an offer, you can ask the seller when they hope the date of entry will be. They may not be able to move out before a certain date, or they may need the sale to go through by a particular date. Because of this, the date of entry you suggest can influence the seller's decision about whether to accept your offer.
You will want the date of entry to coincide as closely as possible with the date you leave your old accommodation. This will avoid you having to pay rent and a mortgage or two lots of mortgage payments. However, it may be convenient to arrange a small overlap for cleaning and decorating your new home before you move in.
If you are selling your old home and the sale will not have gone through before the date of entry for your new home, you will need to take out a bridging loan. This can be arranged through your bank or in some cases through your solicitor, but remember that the costs of a bridging loan are high. Always discuss with your solicitor the risks and implications of putting in an offer for a home before you have sold your own, as you do not want to be left with two properties.
If you are currently renting, you will have to give your landlord the correct notice before you can end your tenancy.
If you have to leave your old home before you can move into the new one, remember to include the costs of any bridging loan required, interim accommodation while you wait to move in, storage for your belongings and two removals in your moving costs.
Any other conditions
Your solicitor will include a number of other conditions in the offer. Most of these conditions are standard, for example they will make sure that the sale will only go through if:
- the seller has the right to sell the property
- there are no outstanding repairs to the property or communal areas
- if any alterations were carried out in the past, the correct building warrant and planning permission were granted at the time and the work was carried out properly.
You can ask your solicitor to go through the conditions with you.
You may also put in a condition that the offer is made 'subject to survey', which means that you will only obtain a survey if your offer is accepted in principle by the seller.