How to choose the best offer when selling a house
You're selling your home, and you have multiple offers. Is it as simple as accepting the highest bidder?
Have you accepted an offer on your home? Need a proactive conveyancing solicitor? Get a conveyancing quote here.
Selling a home isn't "one size fits all"
When buying and selling property, every transaction will involve different challenges, different circumstances and different timescales.
If you have multiple offers, choosing the right buyer can make a critical difference. Your choice of buyer can mean the difference between a fast, (relatively) stress-free process, and a drawn-out sale that could ultimately collapse.
Your prospective buyers will most likely offer you a variety of pros and cons, depending on their individual situations. The highest offer may not be the "best". How do you choose the right offer when selling your house?
Work out what your priorities are
Your first priority is actually selling your house. But do you need to move very quickly, or do you have the luxury of time?
Are you under pressure to sell ASAP (in order that you don't lose the property you're looking to buy) or are you still house hunting?
Working out how much time you can afford to take over a sale is essential in establishing what type of buyer best suits your circumstances. Once you've done this, you can weigh up the advantages and disadvantages of the various buyer profiles.
Let's have a look at the most common types of house-hunter:
The cash buyer
The obvious advantage of a cash buyer is that they aren't reliant on their own buyer (or, as in some chains, many other buyers and sellers) to purchase their property before they can buy. If you're in a hurry, a cash buyer may seem like the perfect solution.
Unfortunately, the cash buyer also knows they are an ideal prospect. From the cash buyer's perspective, offering you a swift sale may give them the confidence to make you a lower offer. We're back to priorities: what's more pressing, time or money?
The buyer who needs to sell
Here, you may be dependent on more than one person in the selling chain. There may even be many transactions along the line that need to go through, before your buyer can complete the purchase of your house.
Being part of a chain is the more common scenario, and buyers in a chain know that they may be competing against a more attractive cash buyer. This knowledge can encourage a buyer in a chain to make a higher offer, as an incentive for you to wait for their sale to go through.
If you can afford to wait, you may find you secure a higher offer by negotiating with a buyer in a chain.
The first-time buyer
First-time buyers are coming from a rental properties, or from the family home. As with cash buyers, they aren't weighed down by the dreaded chain of transactions.
However, first-time buyers don't have a home to sell to raise capital and have never had a mortgage. Unlike a cash buyer, they are still dependent on securing a mortgage to fund their purchase. It is worth discovering whether or not they've secured a mortgage in principle before you jump at their offer.
You may not know initially whether they're a first-time buyer or not, but your estate agent can get the measure of their situation on your behalf.
Once you've prioritised, play your hand wisely
Make sure your estate agent gives you as clear a picture as possible of your prospective buyers' circumstances.
The agent can help you to discover how long a chain is, how far along the road to selling the various parties are, or just how keen a cash buyer is to get things moving.
You can then be more confident in your negotiating position and work to get the outcome that best suits your circumstances.
There is (usually) no hurry to accept an offer the very instant you receive it, and if you return to a buyer with reasonable reservations about their situation, you may find them willing to make a higher offer to secure the sale.
Regardless of a buyer's profile, a buyer's initial offer is likely to be lower than your asking price, so be prepared to negotiate in any event.
How can Quittance help?
If you are buying, selling, remortgaging or transferring equity in a home, our conveyancing solicitors can help.
Our conveyancing service aims to deliver a stress-free moving experience. In particular we focus on proactive communication as this can help drive a purchase or sale forwards to speedy completion.
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