Sealed bidding on property - any experiences?
Discussion
Seen a house I like and it has a guide price and a deadline for 'sealed bids'.
Not personally had any involvement in a sealed bid process before and wish that this particular property was not subject to this process as would have liked to enter normal offer and negotiations.....
Any idea of what current actual sales price is as % of asking price? I know that RICS do reports on this but can't find anything 'current'.
Not personally had any involvement in a sealed bid process before and wish that this particular property was not subject to this process as would have liked to enter normal offer and negotiations.....
Any idea of what current actual sales price is as % of asking price? I know that RICS do reports on this but can't find anything 'current'.
I think that was the process we went through when I bought my current house. The owner died unexpectedly leaving just his old Mum and a sister who wanted a quick sale.
The agents set the guide price fairly low (£182K in 2003) to get loads of interest, did open days and then told us all the highest bid of the 6 they had recived which was £194K.It then went to final sealed bids.
I am not sure we were the highest bidders but we were already sold up and exchanged on our sale on the day of the final offers. They sought written proof of that fact before they confirmed we had won. We thought most people mentally would go to £200K, so we went £203K on the philosophy that others would be thinking the same and going £201K and perhaps £202K to sneak it
They told us when it went to final offers that there would be no further negotations or bids accepted after the final time. We alos had to outline our position in relations to any existing property we had to sell to proceed. Not sure if that was to wring out the last penny from people, or a genuine indication that the family wanted it sorting quickly and didn't want a bidding war with people who were not able to proceed. We did have to wait for probate for a few weeks but it went through very quickly therefater. They wouldn't tell us what the other bids were except to say that the family had a number of offers within a few thousand pounds of each other, but thenthey would say that!
I think it is a good way of getting maximum money from a property in which there will be a lot of interest and avoiding getting into a chain with people who are not really committed to the purchase or whose chain is vulnerable.
Nolar Dog said:
Can you not check a comparable on House Prices?
Would have been nice to be able to do this but only 1 property sold in the postcode since 2001 and all properties in that part of the village range in size, date, character, etc, etc. TBH I think this is why the agent has put it on as a guide price as they are struggling to value and are asking for sealed bids just to get some firm offers in by way of indication.....
Remember with sealed bids its not just about the actual bid, its also about your situation.
If you are ready to proceed that carries weight.
If you are a cash buyer tell them.
If you are sold and exchanged tell them.
If you need a mortgage have you sorted the lender etc if not do so and tell them.
The bid itself needs to be a weird number, there's no point for instance going for £190,000, you need to go in at £191750 or similar. This does two things.
1. It knocks out any other bid at £190,000
2. It looks to the agent like you've done some homework on the property.
You need to consider how much you would spend on the property if it was in a normal sale, and how much extra you will pay to secure the place. You also need to consider if the place is genuinelyt worth what you are prepareed to ffer on it.
From what little experience i have guide prices on sealed bids are used more as a minimum than a max figure.
If you are ready to proceed that carries weight.
If you are a cash buyer tell them.
If you are sold and exchanged tell them.
If you need a mortgage have you sorted the lender etc if not do so and tell them.
The bid itself needs to be a weird number, there's no point for instance going for £190,000, you need to go in at £191750 or similar. This does two things.
1. It knocks out any other bid at £190,000
2. It looks to the agent like you've done some homework on the property.
You need to consider how much you would spend on the property if it was in a normal sale, and how much extra you will pay to secure the place. You also need to consider if the place is genuinelyt worth what you are prepareed to ffer on it.
From what little experience i have guide prices on sealed bids are used more as a minimum than a max figure.
From my experience the estate agent has already done a Deal or Back hander with a 'Friend'.
My Brother even went to the seller afterwards and spoke directly about price and the seller admitted that his offer(which was higher than was accept)was not given to him!!.
If I was you I would try and find out who the seller is and try doing a deal direct! Cut the A hole estate agent out of the picture
My Brother even went to the seller afterwards and spoke directly about price and the seller admitted that his offer(which was higher than was accept)was not given to him!!.
If I was you I would try and find out who the seller is and try doing a deal direct! Cut the A hole estate agent out of the picture
sealed bids and estate agents. Should be banned or supervised by a solicitor (who also isn't bent)
When I bought my current house there was an open viewing.
At the open viewing we were told (Saturday) that the best offer on the desk on Monday by 5pm would secure the house.
The house was up at 198k so having sold my own already and residing with my wife and kids at my mums till we found somewhere else I offered 245k thinking that would blow everyone else out of the picture (had it valued at 250k)
On Tuesday morning I enquired about the sale only to be told there had been so much interest it was going to sealed bids to be opened the following friday.
So we put in another bid and my wife now anxious to secure the home having fallen for it suggested 275k to make sure we got the house.
This I did but then fortunately I had a friend in another estate agents and a story got back to me about this house where the offer had gone sky high...(This was 2001 pre housing boom).Some builder who had been after the house told of how he had been after a house and he relayed a tale of how it had shot out of his reach.
I recognised immediately it was about my prospective house due to the location mentioned. The builder even relayed the numbers involved.
I was mortified to discover that the original offer I had put in (which the estate agent had told us on saturday would be picked on Monday) had been the highest one so in effect by upping my offer for the sealed bids I was bidding against myself.
Needless to say I got straight onto the phone to the estate agent and ripped into him big style.
I accused him of sharp praticce and breach of original verbal contract. I withdrew my sealed bid offer and told him my original offer still stood and that he should accept it if he didn't want to go to court.
He did, I got the house and fortunately despite all the to-ing and fo-ing in the market place since its still worth more than double what I paid for it.
When I bought my current house there was an open viewing.
At the open viewing we were told (Saturday) that the best offer on the desk on Monday by 5pm would secure the house.
The house was up at 198k so having sold my own already and residing with my wife and kids at my mums till we found somewhere else I offered 245k thinking that would blow everyone else out of the picture (had it valued at 250k)
On Tuesday morning I enquired about the sale only to be told there had been so much interest it was going to sealed bids to be opened the following friday.
So we put in another bid and my wife now anxious to secure the home having fallen for it suggested 275k to make sure we got the house.
This I did but then fortunately I had a friend in another estate agents and a story got back to me about this house where the offer had gone sky high...(This was 2001 pre housing boom).Some builder who had been after the house told of how he had been after a house and he relayed a tale of how it had shot out of his reach.
I recognised immediately it was about my prospective house due to the location mentioned. The builder even relayed the numbers involved.
I was mortified to discover that the original offer I had put in (which the estate agent had told us on saturday would be picked on Monday) had been the highest one so in effect by upping my offer for the sealed bids I was bidding against myself.
Needless to say I got straight onto the phone to the estate agent and ripped into him big style.
I accused him of sharp praticce and breach of original verbal contract. I withdrew my sealed bid offer and told him my original offer still stood and that he should accept it if he didn't want to go to court.
He did, I got the house and fortunately despite all the to-ing and fo-ing in the market place since its still worth more than double what I paid for it.
Skodaku said:
Isn't this process the norm in Scotland ? Certainly was when we lived there in the '70's. You bid and if you win then you have just entered into a legally binding contract. If you're not serious, you don't play.
Any Scots care to comment ?
It was the norm up here to have property advertised at "offers over" a set price and back in the days when property was booming it was common for a closing date to be set for sealed final offers to be submitted. More recently it had become the norm that somewhere in the region of 10% over the asking price was the minimum expected but even more recently the "offers over" figure has been used as a general point of reference for starting the 'how much do you want' type of negotiation. Due to the slump in sales, most newly listed property seems to be at Fixed Price now with sellers expecting offers under that figure so probably more comparable with England.Any Scots care to comment ?
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