Receiving an Offer and Accepting an Offer on your Property
Once your property has been on the market for a sufficient amount of time inviting viewings and queries, it is highly likely that you will find yourself receiving offers on your home. This can be an exciting time for the seller, but it can also be a formidable challenge to navigate the stages between receiving these offers and finally accepting one. With over 360 years of selling Cornish property between us, our guidance can be invaluable to you when you are finally ready to move on from your property.
It is typical practice when selling your property that the first offers you will receive will be below the asking price. These offers will usually fall 5%-10% below the valuation in order to give the buyer some room for negotiation. It is important at this point that sellers do not worry or take it as a sign that the valuation of the property is misleading. Some offers, however, may fall below this 5%-10% threshold. Barring unusual circumstances, these offers are very rarely accepted. It is important that as the seller, you are clear on your own situation and have clear targets in mind regarding not only the price you would like to sell your property for, but how long you are willing to keep your home on the market and who you would like to sell it to.
What to Consider
Like with any big decision, there can be insurmountable considerations to be made when selling your property. Unfortunately, it is rarely as easy as simply accepting the highest offer on your home. (CONT.)
- The Buyer’s Financial Position
The financial position of the buying party is one of the biggest considerations a seller has to make when the offers are starting to be made. Although this may seem obvious, it is often a little more complicated than a simple, “Can these people afford to buy my house?”
The majority of buyers will be taking out a mortgage in order to finance any purchase. The process of negotiating a mortgage can be time-consuming and many buyers will not have a concrete agreement in place with the mortgage broker there will be a delay with the purchase. It is therefore important that the buyer has an AIP (Agreement in Principle) with the mortgage lender in order to minimise the time spent negotiating the purchase. Albeit rare, cash-buyers have an advantage here as they have the personal finances available to purchase your home, negating any delays in the selling process.
Oftentimes, if a buyer has to sell their current home in order to finance the purchase of your property, the sale can be delayed, as it hinges on them being able to sell their property beforehand. This occurrence means that the buyer is part of a ‘chain’, meaning that a buying a property is dependent on other properties being sold. For more information on this, please have a read of our Property Chain post (HYPERLINK).
- The Buyer’s Flexibility
Aside from the buyer’s financial position, their flexibility is also a key factor when they are making an offer and will play a part in the seller’s decision on whether to accept their offer or not. If the buyer is part of a chain, they will be reliant on the sale of their own property to purchase yours. This will place constraints on the buyer and will elongate their timeframe as well as the seller’s too. First-time buyers often benefit because of their flexibility. They are chain-free and are more-often-than-not in a position to get the deal done and to move immediately.
- The Seller’s own Circumstances
When offers are beginning to be made on your property, it is also important that you consider your own position as a seller. If you are in a hurry to move to a new home, it could mean that the process of selling your home will have to speed up and you may miss out on accepting the best offer. If you are not in a hurry, then it’s worth taking your time and letting more offers come in, allowing you to evaluate which one to accept.
Accepting an Offer
Once you have evaluated the pool of offers that have been received on your home, you could be in a position to either accept one of them or keep your home on the market for a while longer. If you are accepting an offer on your property, it is important that you consider the buyer’s financial position and flexibility as well as your own circumstances.
When you do accept an offer, the purchase of your property will be STC (Subject to Contract). The buying party will then organise a property survey which will evaluate certain aspects of your home, including, but not limited to its structure, its potential for renovation, and the need for maintenance and repairs. A conveyancing professional will also step in at this stage to handle the contractual and legal side of the sale in order to progress it in the most efficient way.
Property surveys and contracts can often foresee future circumstances that may not seem beneficial to the buyer, meaning that they could pause the negotiations and even stop them if they can’t find a solution. Sellers, too, can experience circumstances that may prompt them to pull their property from the market, even after an offer has verbally been accepted. It is important to note that until the final exchanging of contracts, the sale is not legally binding and either the buying or selling party can pull out of the purchase at any time.
Working with Lillicrap Chilcott to sell your property will put you alongside professionals who have unrivalled experience of the Cornish property market. Our skills and knowledge will be there from putting your property onto the market to the day when you finally move out. We sell over £1.5million of property each week in Cornwall and we believe that our success is the result of our unique outlook and dedication to the details. If you are thinking of selling your property, we’d love to hear from you.