Making an offer – negotiating the price

You’ve found the property of your dreams and you want to make an offer but what can you do to maximise the chances of it being accepted?

Last updated:

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Nobody wants to pay more for a property than they need to so you’ll want to negotiate the best price possible for your dream home. But should you offer under the asking price and, if so, by how much? And how can you make a successful offer more likely?

Preparation is key, both before you even start looking for a property and once you’ve found one you want to make an offer on. This will put you in the best position and give you more confidence in the offer you’re making.

What to do before making the offer

An estate agent will want to know that you can afford the property so if you’re buying with a mortgage it’s a good idea to get a mortgage agreed in principle before you start house hunting. Speak to a mortgage adviser for help with this.

Getting a mortgage in principle will give you the documentation to prove that you’ll be able to borrow the funds you need as well as help you decide your budget. Also take into account the running costs of properties, including bills such as council tax, as well as extra costs like stamp duty, when calculating this. It’s worth underplaying what you can afford to estate agents as they will often show you properties slightly above your limit.

You also need to make sure you have the money to pay your mortgage deposit, which could be 5% of the purchase price or more, and the documentation to prove it. If you’re not buying with a mortgage, you’ll usually need to pay 10% of the purchase price to exchange contracts, when the sale becomes legally binding (in England, Wales and Northern Ireland).

House price research

It’s essential to investigate the prices of similar properties in the area you’re buying in so you can decide what the property’s really worth and what is a fair price to pay.

Look at asking prices (you can assume that most properties will sell for slightly less than the asking price unless the market is very fast moving) by looking at property portals such as Rightmove. Sold prices for specific local properties can be found on the Land Registry website. Also look at overall price trends in the area you’re buying in – these are available through the Land Registry’s house price index.

You’ll need to show ID to the estate agent when you make an offer so have documents such as your passport and driving licence ready.

When is a low bid likely to be successful?

Factors that could make a lower offer more likely to be accepted include that the property has been on the market for a long time (Google the address to see if it’s been listed before and at what price), the sellers need to move quickly or they’ve already found the home they want to move to. Speak to the estate agent about the circumstances of the sale to find out whether any of these apply.

It’s also useful to find out if they’ve had any previous offers and why they were rejected as well as the minimum amount the sellers are prepared to accept. Building a good relationship with the estate agent could make them more willing to reveal information that could help you but remember that they are working for the seller.

The level of offer you should make also depends on the local market. If there are lots of properties for sale but not many buyers looking you’re more likely to be able to offer below the asking price. However, if it’s a fast-moving market with lots of demand for the properties available, this is less likely to be successful.

In some cases you might even feel it’s necessary to offer above the asking price, especially if other people have also made asking-price offers. Or you may be asked to submit a sealed bid over a certain amount or your “best and final” offer by a certain date. How much competition you face is key.

Deciding how much to offer

You need to be seen to be making a serious offer while not offering over the odds and ending up paying more than you need to, so it’s important to get the balance right.

Once you’ve decided how much the property is worth based on all the relevant factors, you can either offer the best price you’re willing to pay (and can afford), making this clear to the agent, or offer less to see if you could get the property at a bargain price while leaving room for negotiation upwards.

Avoid offering a round number as this makes it more likely that you’ll offer the same as another buyer. Around 5% to 10% below the asking price is reasonable depending on the market.

How to put in the offer

You should make the offer over the phone to the estate agent and then confirm it in writing via email. Alternatively, you can make the offer in person at the estate agent’s office, if they have one, and then confirm it by handing them a letter or via email.

Also highlight any points that make you a particularly attractive buyer. Aspects in your favour would include being a first-time buyer, being a cash buyer, buying with a mortgage but with a high deposit, and being in a position to move quickly or flexibly according to what suits the seller.

Having evidence that you have the funds available and your solicitor or licensed conveyancer lined up also shows you are well organised and ready to go. It’s a good idea not to appear too keen as you might give the impression that you are prepared to buy the property at any price.

By law, estate agents must pass on every offer they receive to the seller.

If your first offer is accepted, it’s time to celebrate – just remember that the property isn’t guaranteed to be yours until exchange of contracts though. If it’s rejected, you’ll need to consider whether to go back with a higher offer and for how much but be careful not to exceed your budget.

The agent should be transparent about any better offers the seller has received. There could be a few rounds of offers and counter offers before you reach a final answer.

Once your offer is accepted, ask for the property to be taken off the market and for no more viewings to take place to reduce the chances of someone else making a higher offer that is accepted and “gazumping” you.

You may want to reduce your offer later if the survey uncovers problems with the property that are expensive to fix, which could lead to more negotiations.

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder.com provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on finder.com are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.
Go to site