Sensible offer on asking price?

I've come across a "do-er up-er" thats there for 250K. It's got the potential, and I reckon we can manage the cost. Unfortunately the bank will only offer us 170K, and we've 50K in savings.
Clearly that puts our upper offer at 220K, but it'd be best if we could minimise the mortgage amount.

In the current market, what a "reasonable" low first offer on a 250K asking price?
Would 190K be insulting and get us off on the wrong foot?
200K?
???

Thanks

It really depends on how realistic the asking price is, and we have no way of judging that.

Fair comment.
I don't really have any way either, as I haven't seen the property myself. But I'm guessing (by the looks of it) that the asking price seems fairly reasonable.

Never be insulted to make an offer, you are a legitimate buyer at a given price and all offers especially on a property needing work would in my view be welcomed.

If its on the market at 250K they are probably hoping to walk away with 225K so maybe offer 215K and see what happens.

So, without inspecting the inside, you reckon you can over the cost? How much 'other' savings do you have forthis refurbishment, as clearly you can't borow it or are including it as part of your savings mentioned above to purchase the property ?

How long to do it up ? What are neighbouring houses goinng for ? What are you hoping to sell it for - why do you think its currently under-priced, and are looking to even to go lower than that ?

The most important part is your affordability. The bank will offer you 170k but at what loan-to-value ratio? If it is 80%, you could by a property at 212.5k which would require you to contribute 42.5k to the purchase price. This would only leave you 7.5k for purchase, legal, surveyor and moving costs. You would have little if anything left for appliances, fit out or any renovation. If the LTV is 90% you could only pay 189k for a property but would have 31k of savings for the cost of purchase and making the property livable.

It is impossible for anyone to advise what you should offer but I would not be concerned about an offer being 'insulting'. If it is made genuinely then the vendor makes a decision whether to accept or refuse. To help you to determine if your offer is realistic, look at the property price register to see if there are other house sales in the area that will give an indication of the prices being achieved. The length of time on the market may also be an indicator of whether or not the house is priced at current market levels.

I would start very low with an offer you expect the be refused. This should have the effect of the seller re-evaluating their expectations and then when you come in with your second offer (which is still significantly below asking price), it should be more palatable to the vendor. 190K sounds fine to me, still slightly over 75% of asking.

There is no one current property market.
Ireland is dived into Dublin and the rest.

I assume you have a good idea of how the market is doing in your area-as regards both prices and sales volume?
Have prices continued to fall as per most rural areas,especially in border counties and much of the west? Or have they remained constant as in much of Dublin -even increased in some areas?

Also,regardless of prices ,are houses selling in that area ? They are in Dublin whereas much of the rest of Ireland is dead,dead, dead.

A super low offer in Dublin may mean the agent won't get back to you -quite different from ,say, somewhere in Donegal.

Zulu2002 said:

Would 190K be insulting and get us off on the wrong foot?

Click to expand...

I've heard it said that if your first offer isn't taken as an insult then it's to high.

If I was selling a property in the current market, I would give the Estate agent express instructions not to bother me with low ball offers.
I would be using the Estate agent to screen out all the nonsense.

I would instruct them to put all the tire kicker offers into a big pile and set a match to them.

Seriously, If you're serious about a a property you do want to be taken seriously by the seller. Its no problem at all to sell a property at a low ball
price so the Seller is not going to be too interested in you unless the property is a hopeless case in ballygobackwards

I would use the Property Price Register as my guide

cheers for the replys folks, as it turns out, when I rang to arrange a viewing I was told that they already recieved an offer for 260K so our decision was made for us.