It’s a time for excitement and relief: you’ve received an offer on your house.
Although you’ve probably been waiting for this moment for some time, there’s still more to do before your house is legally handed over to the buyer.
We’ll walk you through some steps to help give you clarity and relieve any anxiety you may feel about the process.
By the time you’re fielding offers from prospective buyers, your own research should have given you a firm grasp on the value of your home and the context of the local property market.
It also may be helpful to know that most would-be house buyers initially offer around 5-10% below the advertised price. Don’t worry: that’s normal.
If you’re confident in your valuation, you can feel comfortable turning down offers that don’t meet your expectations. If the buyer is serious, they’ll make a new offer, which could be more in line with the sale price you had in mind.
Timing plays a role here.
Typically, properties that have just been placed on the market get the most active interest.
As a result, you could get more than one early offer. Don’t necessarily dismiss these out of hand. Yet, depending on market conditions, a strong early bid could also be an indication that you can afford to wait for more attractive offers.
On the other hand, if your property has been on the market for a while, and this is your first offer, it’s worth considering it seriously - even if it’s a little lower than you might have hoped for.
If you get an offer that you’re interested in, first let your estate agent know that you’ll need time to consider it. We’d always recommend taking a day or two to mull over each offer.
If the offer is near -- but not quite -- the sale price you’d hoped for, speak with your estate agent about a counter offer. They may be able to give you insight about whether the potential buyer would go higher, based on feedback they’ve received during the viewings.
An immediate rejection may turn off the buyer altogether, whereas a counter offer could be the start of a process that gets you closer to the sum you’d originally sought.
Some experts suggest using furniture, curtains, and white goods (dishwashers, dryers, furnaces, hot water heaters, stoves, trash compactors, washers) as potential bargaining chips.
Because these items are typically suited - in style and size - to a particular property, many sellers find they’re not going to bring them along to their new home. A buyer may be willing to pay a bit more to have these items already in place when they arrive.
Remember that your estate agent is legally obliged to present every offer that’s made to you.
Oftentimes, sellers discover that multiple buyers express interest at the same time.
Even if you’ve received one serious offer, don’t forget about other interested parties. Ask your agent to inform them that you’ve received an offer. Sometimes, learning that the house they’d expressed interest in is now under offer can motivate other would-be buyers to get serious.
As a seller, you may even find yourself in a position where you can work the price higher into a better deal for you, by having interested parties bid against each other for your home.
Ask your estate agent for advice if you’re unsure how to handle such a situation.
OK, so now you’ve received a strong offer. You and your agent have discussed it and you’re both confident that the potential buyer is serious about moving forward.
You should still try to find out as much as you can about the buyer’s position before accepting the offer, including:
Are they a cash buyer? Cash buyers are often viewed favourably because they can usually move quicker; they’re not stuck in a chain. If they say they’re going to pay in cash, ask for proof.
Does the buyer need a mortgage? If so, you should be comfortable asking the buyer if they’ve had a mortgage in principle approved. Problems obtaining a mortgage could raise some red flags about whether they’re a reliable buyer. They could also delay the transaction.
Is the buyer part of a property chain? If so, is their home also under offer? If the purchaser needs to sell their own home in order to fund their purchase of your property, that could delay the sale, so this is an important point to clarify. Your agent should gather more information on this before you commit to an offer.
What’s their timescale for moving? This is significant because it should fit with your own needs. As noted previously, whether they’re buying the home in cash or as part of a property chain will influence when the sale can be completed. Large property chains, for example, tend to drag on a long time - and are more likely to lead to fall throughs. Conversely, cash or first-time buyers may be open to moving fairly quickly, so it’s worth asking about their flexibility.
Your own situation matters, too.
Most obviously, you need to line up your next home before you leave your old house.
If you need to move quickly, then accepting an offer from a buyer who’s part of a property chain probably isn’t the best idea. Likewise for someone who hasn’t yet had their mortgage approved by a lender.
On the other hand, buyers who are not part of property chains and who already have their mortgages approved can be appealing because it reduces the chances of delays or complications.
Additionally, if you’re not in a hurry to move house, you could consider waiting around for a higher offer.
Your estate agent is a great resource at this stage - use them! They’ve seen most variations of sales before and should have helpful advice.
Once you accept an offer, it’s usually under the condition ‘subject to contract’.
That means that the buyer will most likely complete the sale after the survey -- as long as it doesn’t turn up any unwelcome, previously undisclosed information on the property.
It’s your agent’s responsibility to prove that the buyer has the necessary financial resources to complete the purchase.
But just because an offer is accepted doesn’t mean it’s legally binding.
Gazumping occurs when a seller accepts a new, higher offer on their house despite having previously made an agreement with another buyer at a lower price. (Yes, it’s legal.)
Gazundering is the inverse: It occurs when a buyer suddenly reduces their offer on a property after previously agreeing with the seller to a higher one. (And yes, it’s legal, too.)
Once the contracts have been exchanged and the buyer has paid the deposit, it’s time to agree on a ‘completion date’.
This is the date by which you’ll have to have left your property. On the ‘completion date’ keys will be exchanged and the new owners can move in.
The timing at this stage varies, but usually it takes between 5 and 20 days from exchange of contracts and completion.
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