Offers are an exciting part of the process and are normally part of a negotiation and often includes a couple of rounds of offers and counter-offers back before an agreement is made.
The agent is legally obliged to pass all offers to you and send a written confirmation. If you have very specific criteria for an acceptable offer, you may choose to instruct the agent to reject all offers below a certain price. We would recommend however receiving all offers as each will have its own positives and negatives.
When you receive an offer, the quality of the offer will be a combination of strands, the same strands we mentioned earlier in ‘how much is your house worth’.
Some of the questions to consider are:
Is the buyer ready?
- A well-prepared buyer will have secured an ‘offer in principle’ for the mortgage if they need one.
- If they are going to need a mortgage and have not yet worked out how much they can afford, how realistic is the offer they are putting forward?
- Have they already chosen a solicitor who is ready to start the process?
- If the buyer is ready now they are likely to be more reliable during the sales process.
What is their situation?
- Do they have another property to sell or are they a chain free buyer? A chain free buyer will mean there are fewer elements to the sale, which could go wrong at a later date.
- If they have a property to sell, is it on the market and under offer already?
- What are their times frames for moving and how does this suit your time frames for moving? If you are still negotiating an onward purchase a flexible buyer would be advantageous.
- Are they a cash buyer or will they need time to process a mortgage?
- Are there any other associated people that have not yet seen the property? For example, if a parent is providing part of the funding, do they still need to see it
- How does the offer price relate to the marketing price and the minimum price your agent would expect to achieve?
- Does the offer (regardless of the level) give you enough money to make your onward purchase?
- If the price is lower than expected, do the other factors make up for the shortfall (such as speed of purchase or flexibility)
- Ask your agent for their feedback on the offer.
- Do they think this is the best offer that the buyer will be able to put together?
- Do they think they can get a better offer from another buyer?
- What interest from other buyers do they have in the property at the moment?
- Do they think the buyer is organised and motivated enough to see the transaction through?
- Does the applicant have a second-choice property already?
- What else is available locally that is similar to your property? Is the offer competitive to what else is available?
When considering an offer take time to think it through, especially if it is lower than you were expecting, and do not feel under pressure to give an immediate response. That said, you need to remember that the potential buyer will be excited about the process, so if you can go back reasonably quickly you should be able to continue their enthusiasm. Aim to give a response either way within 48 hours.
You are under no obligation to accept any offer. For example, someone may offer the asking price for the property but may not be proceed-able. This is where they have yet to sell or accept an offer on the sale of the purchase. In this case, it may be better to keep marketing to find a buyer that can proceed.
Where there are multiple offers going backwards and forwards the agent may suggest a sealed bids scenario. Here each buyer will be given a deadline by which to submit their best and final offer for the property and then you would be able to decide which best suits you.
Once you have accepted an offer your agent will issue a Memorandum of Sale confirming the buyers and the sellers’ details and their respective Solicitors or conveyancers. The property will be marked on their books as Sold Subject to contract (SSTC) as the actual sale will only be confirmed once the lawyers have ‘exchanged’ the legally binding documents.