Top Tips for Purchasers & Sellers
The start of 2022 is showing little sign of the Scottish housing market cooling down. The underlying issue of there being less homes on the open market than can meet the demand from buyers remains the same as we saw last year. While there is no magic formula which guarantees a successful move, we have put together some tips based on common enquiries from our clients, which we hope both purchasers and sellers will find useful.
Tips for Purchasers
Can I Negotiate a Price Directly?
Yes, you can. The key is to act quickly if you are trying to agree price, whether you speak to the sellers or estate agents yourself or ask your solicitor to do so on your behalf. In a competitive market, by discussing figures directly you obviously show your hand to a certain extent. While no reputable estate agent would disclose your offer to other interested parties, you should be aware that there is nothing to prevent a seller from doing so. However, the only way to agree a price for a property without a closing date (where a date & time are set for interested parties to submit their best & final offers) being set is to be pro-active and put forward an offer and see where negotiations take you.
How Much Should I Offer?
This is of course the million dollar question and it essentially comes down to two things: how much do you want that particular property and how much can you afford? Nobody wants to pay more for a new home than they need to but the reality is that most properties are presently selling for more than the home report valuation (often substantially more). Sellers may have a figure in mind which would take the property off the market but if a closing date is set there is no way of knowing what is in the minds of other interested parties. If a closing date is set, all that you can do is offer the highest figure which you are comfortable paying and if your offer is unsuccessful hopefully you can be philosophical about it and have no regrets. It is always worth offering a bit of an odd figure as opposed to a figure to the nearest thousand pounds, just in case someone else is thinking along the same lines – we have seen clients both secure & lose properties for the sake of as little as £50!
When Should I Arrange My Mortgage?
In short, as soon as you start looking for a new property! Sellers & estate agents will want to have the comfort of knowing that you have a mortgage agreed in principle. While you cannot have a written mortgage offer for a specific property until an offer for that property has been at least verbally accepted, any such offer is unlikely to be taken seriously unless your mortgage lenders have at least confirmed that they are willing to lend to you. We can put you in touch with trusted mortgage advisers who can source mortgages from across the market as opposed to providing advice on only one lenders’ products so that when you are viewing properties you know what your realistic budget is.
How Much Money Will I Need to Provide for the Purchase Price?
Lenders will provide a percentage of the value of the property (the “loan to value” rate). You should bear in mind that if the purchase price is more than the valuation you will need to provide that difference from you own funds – ie banks/building societies will lend a percentage of the valuation, not a percentage of the purchase price. For example, if you are paying £110,000 for a property which is valued at £100,000 and you are taking a 90% loan to value mortgage, you would need to provide a £20,000 deposit.
Tips for Sellers
When Should I be Prepared to Move?
It is always difficult when you are selling your property with a view to buying somewhere else but if you are putting your home on the market you should be prepared to proceed with the sale regardless of whether you have had an offer accepted for a new property. While purchasers will often be quite flexible about the date of entry they will want the certainty of knowing a definite date and won’t be prepared to wait indefinitely. We would always recommend that you have a plan B, perhaps to rent or move in with relatives until you have found a new property to buy.
Do I Definitely Own My Home?
You may think that the answer to this question is incredibly obvious but this is not always the case. Sometimes properties are owned in joint names and if one of the owners has passed away it is not always the case that the property will then be in the sole name of the surviving owner. Where a property is to be sold following the passing of a loved one it sometimes unexpectedly comes to light that the property is actually owned by a trust. The ownership of a property can be easily checked in advance of marketing, at minimal expense.
Have I Altered My Property?
If you have carried out alterations which would have require local authority consents during your period of ownership these will be disclosed in the home report which you are required to provide when putting your home on the open market. Your purchaser’s solicitors will require to see the appropriate local authority consents for those alterations so it would sensible to check whether the correct documentation is available in order to avoid any unnecessary delays.
Our Top Tips for Purchasers & Sellers are just some of the issues which might face purchasers & sellers. We appreciate that no two situations are exactly the same and we would be happy to have a chat to you about the whole process of buying and/or selling. Please do not hesitate to contact either one of our partners on 0141-483-4450, Siân or Michael, to discuss your plans.