What happens if two people bid the same amount?

[jvr1980]

I'm currently bidding against someone for a place - it looks like neither party wants to go over 381K because of the change in stamp duty rates.

What happens if I bid 381K and the other party bids the same, or if he bids 381K first and I bid the same?

I can't go higher, and I dont know if the other bidder wants to go higher - so what happens? I think that seller will accept 381K

Sorry if this question has been answered before but I couldnt find it. If someone could help me that will be great

 

[Sarah W]

You could try to give yourself the advantage by confirming to the selling agent that you are mortgage approved (assuming you are) and that you can fit into whatever timescale suits the vendor. Or get creative and throw in a holiday voucher for a €1000 or offer to pay for their removals for the new house. Good luck.

Sarah

www.rea.ie

 

[jvr1980]

You could try to give yourself the advantage by confirming to the selling agent that you are mortgage approved (assuming you are) and that you can fit into whatever timescale suits the vendor. Or get creative and throw in a holiday voucher for a €1000 or offer to pay for their removals for the new house. Good luck.

Sarah

www.rea.ie

Hi Sarah

Is that allowed? And would that go through the estate agent?

We're mortgage approved so that's not a problem - do you know if there's any official protocol that the Estate Agent has to follow? Or will they just put the two offers to the vendor?

Have you heard of this happening before?

thanks

 

[Sarah W]

I can't see why it wouldn't be. The estate agent will be trying to close the sale for the maximum price so (personally speaking) I would leave the offer of €381,000 for them to deal with and approach the vendor directly to see what would tip the scales in your favour. No harm in trying.

Sarah

www.rea.ie

 

[jvr1980]

I can't see why it wouldn't be. The estate agent will be trying to close the sale for the maximum price so (personally speaking) I would leave the offer of €381,000 for them to deal with and approach the vendor directly to see what would tip the scales in your favour. No harm in trying.

Sarah

www.rea.ie

Thanks Sarah - I hope it doesn't come to this but I'm worried it will

Very confusing!

 

[SteelBlue05]

Is this legal? Sounds like a way of avoiding paying stamp duty....

The buyer could also offer 1000 euro worth of gold or something so....sounds like a way of avoiding stamp duty which is not allowed I reckon.

 

[jvr1980]

Is this legal? Sounds like a way of avoiding paying stamp duty....

The buyer could also offer 1000 euro worth of gold or something so....sounds like a way of avoiding stamp duty which is not allowed I reckon.

That's what I thought - does anyone know what the Estate Agent has to do?

If I bid 381K and so does the other bidder do I get the option because I bidded first?

 

[Satanta]

If I bid 381K and so does the other bidder do I get the option because I bidded first?

No. The seller has the choice. Even if the other bidder goes 5k under you the seller can decide to go with them if they are more confident in the other buyer not backing out etc.

Your best bet is to try and convince the seller that you're the safer bet. Using payments (be it under the table, holiday vouchers, cash deal for contents etc. etc.) is common but I'd be hugely against anyone ever going this route, be it on ethical or legal grounds personnaly I'm against it.

 

[conor_mc]

That's what I thought - does anyone know what the Estate Agent has to do?

If I bid 381K and so does the other bidder do I get the option because I bidded first?

Sellers choice then, whoever they think will be best placed to close the deal. If I was selling, I wouldn't tolerate any first-come, first-served rubbish from an EA... I'd accept the offer of the mortgage-approved, preferably-chainless buyer. If both were in a chain, I'd want to know where their respective house sales are currently at.

 

[Mag2006]

Some estate agents will do a deal when it's got to do with stamp duty. I have heard of it happening before. For example purchaser offers €317.5k and does not want to go over the stamp duty threshold so contracts reflect €317.5k, solicitor is kept in the dark and the purchaser and vendor do a deal in cash for the difference or something like that. My husband heard someone talking about doing it once before and he was shocked but fair play I say saving a few thousand. The stamp duty is completly unfair on FTB's. I don't think they are breaking the law, just working their way around an unfair system really!!. I never got the chance to do it but if I was in the position I would if I was offered the option and I'm not law breaker!!
OP best of luck, hope it works out for you and Sarah W's advice is very good.

 

[jvr1980]

Sellers choice then, whoever they think will be best placed to close the deal. If I was selling, I wouldn't tolerate any first-come, first-served rubbish from an EA... I'd accept the offer of the mortgage-approved, preferably-chainless buyer. If both were in a chain, I'd want to know where their respective house sales are currently at.

We're mortgage approved FTBs so there's no problem about closing any deal or anything like that - which should in theory give us an advantage.

Someone told me that if there is a bid of x on the table you can't bid the same (i.e you have to go x+1) - does anyone know if this is true?

thanks for the help everyone

 

[Satanta]

I don't think they are breaking the law, just working their way around an unfair system really!!

You may not think so, but I bet Revenue would.

OP best of luck, hope it works out for you and Sarah W's advice is very good.

While it does happen (and getting more frequent from stories of buyers/sellers), I wouldn't consider it good advice to go this route. It may secure you the house, but far from something that should happen! It's verging on, if not outright, tax evasion so not exactly "good advice".... though 99% of Sarahs posts are absolute gold!

Someone told me that if there is a bid of x on the table you can't bid the same (i.e you have to go x+1) - does anyone know if this is true?

You can put any bid you like to an EA. They may not put it to the seller, the seller may not accept it, but you can still make it. Given the current market, a seller would think twice about going with a higher bid from someone in a chain than a taking the safer option of someone with no house to sell.

 

[Sarah W]

To make it clear I am not advocating avoiding Stamp Duty. The contract price is €381,000. If you want to express your thanks to the vendor by buying them a holiday (I *think* the gift tax threshold between strangers is €1270 but stand to be corrected) then I don't believe there is anything wrong with this.

Sarah

www.rea.ie

 

[jvr1980]

To make it clear I am not advocating avoiding Stamp Duty. The contract price is €381,000. If you want to express your thanks to the vendor by buying them a holiday (I *think* the gift tax threshold between strangers is €1270 but stand to be corrected) then I don't believe there is anything wrong with this.

Sarah

www.rea.ie

Do estate agents turn a blind eye to this sort of thing - and do they get a cut of the gross sale price or the sale price minus stamp duty?

 

[Satanta]

I don't believe there is anything wrong with this.

If Revenue deemed the gift to be a measure to avoid tax they would take exception to it. The gift exemptions are clear, but using them for personal gain, even if all thresholds are maintained, is not allowed (examples given on transfers of property between family members to avoid CAT/CGT on the Revenue documents re gift tax).

The chances of this being discovered and traced by Revenue are next to nill, I just don't agree with the tactic. If I was discussing this in relation to my own dream home, who knows how my views might change.

Do estate agents turn a blind eye to this sort of thing

Some actively encourage it. A family member had an EA clearly state they would do up documents on the house contents to be included in sale with inflated prices to gain the seller the price they wanted and the buyer a reduction in SD. I was standing in front of him when he said it.

 

[jvr1980]

If Revenue deemed the gift to be a measure to avoid tax they would take exception to it. The gift exemptions are clear, but using them for personal gain, even if all thresholds are maintained, is not allowed (examples given on transfers of property between family members to avoid CAT/CGT on the Revenue documents re gift tax).

The chances of this being discovered and traced by Revenue are next to nill, I just don't agree with the tactic. If I was discussing this in relation to my own dream home, who knows how my views might change.


Some actively encourage it. A family member had an EA clearly state they would do up documents on the house contents to be included in sale with inflated prices to gain the seller the price they wanted and the buyer a reduction in SD. I was standing in front of him when he said it.

I'm happy enough for this to happen if it seals the deal - IMO it's a disgrace how Stamp Duty encourages this sort of behaviour though

 

[capricorn]

I'm happy enough for this to happen if it seals the deal - IMO it's a disgrace how Stamp Duty encourages this sort of behaviour though

people evade all sorts of tax all the time, its not specific to stamp duty. Its a bit like saying income tax encourages people to work for cash.

 

[MonkeeMan]

If they are leaving furniture, cooker, carpets etc in the house then it is perfectly legal to pay a reasonable price for them and not have it considered as part of the house purchase price, thus keeping yourself below the threshold for stamp duty. This is totally legal if the amount you pay is reasonable and not a clear cash payment towards the house itself.

 

[murray]

If it was me , I would knock in on the property early evening , with a well worded letter and a copy of my AIP (mortgage approval) - to prove to the vendor that I was serious - after all they want it to go through with ease. Once they can put a face to the name - it becomes a bit personal - so you would have a good chance of getting it I'd say - also if the conversation came up about buying some furnitur privatley - could tip the balance - and 100% legal.

 

[phoenix_n]

jvr1980.

The most sensible thing for you do is to stand back for a moment and to realise that you may be in a stronger position that you actually realise. The market is showing signs of slowing and buyers are in a better position as a result. Play harder, make it known that you are mortgage approved etc but also continue to shop around to note what current market prices are. Dont focus on this one property and lose sight of the bigger picture.

Good luck