Bidding for a house

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firsttimebuy

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I am currently bidding for a second hand house that I really want but everytime I put in a bid with the estate agent he comes back nearly straight away to say there is another bid against me for €1,000 more. I have increased my bid twice now but I don’t want the price of the house to spiral out of control. Is there anything I should be doing or any questions I should be asking? I don’t have any experience in this so any advice would be very helpful.
 
Have you offered the asking price of the house?

should say FTB myself, but thats what comes to mind. sorry not really much help
 
Nothing really you can do other than hope that the other one gives in first. Just decide on the max you're willing to pay and you think the house is worth and let it go if it goes beyond.
Sometimes it depends on whether you're close to SD cut-off points - a lot of people don't want to go beyond, so sometimes this is where it stops.
 
It is very hard to know whether the estate agent is calling your bluff or not... and if it's a house that you've really fallen in love with, it's easy to say to yourself that you're not going to lose it for the sake of 1 or 2 grand....

however, you really do need to set yourself a maximum limit, based on what you can afford (remember to consider stamp duty, furnishings etc in your costings), and also what you believe the house is genuinely worth.

best of luck!
 
Just in response to this, I've noticed of late that alot of the 2nd hand properties we are looking at are guiding somewhere between €330 - €360k. Alot of the bidding occurs very quickly after the fist viewing and it tends to stop at the €380k mark alot as most people are unwilling to enter into the 6% stamp bracket.

So my predicament, I have just seen a house today that I am hoping to bid on first thing monday morning..as a FTB I have a max spend of €380k as well. The house was guiding €360 and whilst I do think it will go well above the €380 mark, I at least want to get in there and bid. So the question, do I just jump in and bid my max. of €380K or do I bid the asking price first and run the risk of someone hitting the 380k mark before I even have the phone down?

unbelievably fast market now and I want to have my say in it!

Any ideas?
 
Hi newbie, I've come across this a couple of times that buyers even put in a tentative offer before they had seen the house with a view to confirm it at the first viewing. I went and saw a house and put down the 381K straight away and I was in the lead for a good while but eventually someone came in with a higher offer and I lost out. The place I ended up buying I ended up in the 6% bracket, but as you've said a lot of people don't want to go there, so the first one that gets their offer in at the cut-off has some advantage at least. Ring up mon morning and see what they say. Quite often they receive offers on the same day of the first viewing, so if they have already some in on mon morning, you could ask how many parties have put in offers, and based on all that you could decide to go in full whack... In the end it's your decision, but I've done it myself and it almost worked...
 
Thanks Petal,
The 6% stamp is just not an option which can put you in such a bad position...it's all aobut competing at this point.

Calling the EA in the morning so will post here again as to what happened. Fingers crossed!
 
Am I wrong in thinking that you can always pull out of a purchase even if you have made the highest bid and it is accepted. If this is so, why not keep bidding without worrying too much and when your price has been accepted, then take some time to decide whether to go ahead or not. A bit like reverse gazumping!
 
I'm assuming the same dmkelly..not really for the purposes of bidding to high levels but I assume that you dont bother calling a surveyor out unless you are really serious about the property....obviously you can pull out then at that point if you want? I'd imagine it goes to the next highest bidder then? Anu insight into this would be good though...
 
dmkelly.......do not do to others what you would not like done to you..... this is totally unfair on other bidders.. if you have no real intent on buying, then all you are doing is driving up the cost & potentially driving others out of their dream home.

I have been a recipient of that particular tactic and it is not pleasant
 
When we bought our house way back when, we agreed a price of 64,000 with the EA. Once you went over 60,000 at the time, you went into a higher stamp duty rate. We actually paid 59,500 for our house and agreed to pay 4,500 for the contents. We made a considerable saving by doing this. the seller didn't care as he still received 64,000.

Has this loophole been closed off?

Murt
 
Thanks Murt10,

I didn't think of that to be honest but would hold the thought alright if/when it gets necesary. i think this particular property is going to go way above our means but perhaps the next one we find.......

thanks...
 
Just to update this thread, I called the EA this morning at 9:05 and was told that there was already a bid on of €381k. when I asked when it was made, I was told at the viewing on Saturday. I distinctly asked the EA on Sat, what was the procedure on making a bid and he told me I would have to wait until Mon morning to make a bid.......so how did he accept a bid from someone else?

Is this normal that verbal bids are made during viewing times?
 
I wonder what the EA will have to say about that, I'd be furious. It seems to be a race to bid 381k first, so if you can afford it, just go to 381k. Play every card you have - ask if the other party are in a chain and what the situation of the vendor is. They may be looking for a quick sale rather than being delayed by the chain thing.
 
Sorry Ann, what do you mean a "chain"? I am really annoyed. It's all a leaning curve right now and it doesn't help when there's a different story for every house, vendor and EA!
 
A chain is when the other bidder has a house to sell as well, which may delay the purchase. If he's in one and you're not, then you are at an advantage. It's probably unlikely if the house is around the 381k mark but worth asking.
 
Murt10 et al.....

I have to post on this stamp duty issue mentioned above. The breaking up of the purchase price to avoid paying a higher stamp duty rate IS ILLEGAL. It is not allowed, it is NOT a loophole. The figure on which stamp duty is based is the total consideration for the property. Stamp duty is calculated on the value excluding any value assigned to contents but the FULL all inclusive price is used when determining the RATE of stamp duty payable.
It is a recipe for disaster if you bid on this basis above a level which you can actually afford.

Apologies if this sounded like a rant but it's a real bug bear of mine these notions and schemes that get bandied around.

S
 
If you aren't sure the EA is being completely honest about bids on a house a useful trick is to get a new 'interested party' (a friend or colleague) to ring them and ask what the current bid is on it - the agent is more likely (IMHO) to tell the truth to a potential new buyer than to someone he/she knows is very keen to buy and therefore may be tempted to overbid.

Sarah

www.rea.ie
 
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