Buying a home is that time in life when you’ll happily commit hundreds of thousands of pounds after a 20-minute viewing and a quick chat with the estate agent. It’s exciting, but excitement can be expensive.
In a market where price growth is not a certainty, it is vital to do your research before you commit. In the news lately, there’s been a fair bit of coverage about overpricing.
But what even is overpricing, and how can you spot if you might be falling victim to it? Here’s my take:
1. Buy with your head first, your heart second
Get your finances sorted before you even book a viewing. A mortgage agreement in principle will get you taken seriously. Sellers want buyers who can proceed.
It is vital to do your research before committing to a house purchase
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Remember that the asking price isn’t a valuation – it’s an advert. The only figures that matter are what similar homes have actually sold for in the last few months.
One of the most prolific property buyers I ever knew had a rule. Before making an offer he’d say, “If you’re not embarrassed by your first offer, you’ve probably gone in too high.”
He wasn’t advocating cheeky or insulting bids. He simply understood that negotiations rarely start where they finish. Most buyers negotiate against themselves. The estate agent is there to help, but remember that they work for the owner, to get the best price – so be careful what you reveal.
2. Become a detective
A viewing tells you surprisingly little. Visit twice. Go once in daylight and once during the evening rush hour. Walk the surrounding streets. Is parking impossible after 6pm? Does the neighbour’s dog bark constantly? Is there a takeaway vent pumping cooking smells into the garden at night? These things change the value.
Try to get chatting with a neighbour. Most people are honest. In five minutes you’ll often learn more than you would from five viewings.
And don’t ignore the listing history. Multiple price reductions or a property that’s been sitting on the market for 190 days tells its own story. It usually isn’t that there’s something wrong with the house – it’s that the price was wrong. That’s valuable ammunition.
3. Spend hundreds – you may save thousands
The survey is the easiest money you’ll ever spend. Buyers often wince at paying £500 or £700 for something they hope will tell them nothing.
A good survey can uncover subsidence, roof defects, damp, failing electrics or structural movement that could cost tens of thousands to rectify. Even if you still want the property, the survey often pays for itself by giving you evidence to renegotiate the price.
Don’t forget the costs that don’t appear on the sales particulars either. Council tax, insurance, service charges, lease terms, future maintenance and energy efficiency can easily change the affordability of a home long after you’ve collected the keys.
4. Remember, there is always another house
This is perhaps the hardest lesson for buyers. After weeks of searching, it’s easy to convince yourself you’ve found the one. You probably haven’t.
Today’s market gives buyers more power than they’ve enjoyed for years
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Today’s market gives buyers more power than they’ve enjoyed for years. There are more homes to choose from, many sellers are having to reduce their asking prices, and properties are taking longer to sell. That means you have something many buyers haven’t had for a decade – time.
The buyer who is prepared to walk away is usually the buyer who gets the best deal. Don’t appear desperate.
Buying your home isn’t about winning the race to exchange contracts. It’s about making one good decision that you’ll still be happy with in ten years’ time. Patience is free, and in property it often delivers the biggest discount of all.
Jonathan Rolande is the founder of House Buy Fast. For more information, visit https://rolande.property/