Can you negotiate on house prices?
 

OK so probably a stupid question but everyone keeps telling us not to get 'stung' or 'done' with regards to property buying that I thought it might be useful to know what the rules of the game are?

We don't want to either look or act stupid.............blimey that's a wide remit ;)

So if a house was on the market for say $700 what would you offer. Or, is like here where you take into account location, length of time on market etc etc.

Thank all

Mrs Jones

PS Must have been asking lots of silly questions as am now a Senior Member :D

Re: Can you negotiate on house prices?
 

Until recently, in many areas , the asking price would have been a MINIMUM figure to start with. It was common practice to publish a deliberately low price to attract interest. I understand this practice is now frowned on.
It was ceratinly happening when we were over in June.

Hence the need to be careful.

G

Re: Can you negotiate on house prices?
 

So if a house was on the market for say $700 what would you offer. Or, is like here where you take into account location, length of time on market etc etc.


It's just like the uk :) In some instances some houses go into sealed bids if there is enough competition for them, then they go for more than the asking price.......... market forces I'm afraid.

Once you put an offer in for a house and sign up you get into a similar system as Scotland so there's no gazumping.

Re: Can you negotiate on house prices?
 

Mrs. Jones,

You do all of the above. At realestate.com.au you can actually buy a factsheet on the area in which you'd like to buy. Prices recently paid for houses in your area, average fluctuation in house prices in your area, even crime stats for the area. Well worth the $50-odd dollars they charge. Then youhave alook at the local newspaper which often lists general problems in the area and look around and ask many questions of the neighbours, then you get someone to check the house for woodrot and insist they give you a recent termite inspection certificate, then you bargain with all facts in hand. Also check whether the house has an old gravity-fed hot water system as this will probably have to be replaced by yourself unless you like your shower temperatures very variable during the duration of the shower and do not object to occationally scalding your toots under 80 deg celsius water as most of these old systems do not have temp adjustable thermostats. Also ask if any gaswork was done in the last say... 15 years and whether it was done by a certified gas man.

I'd start bidding at about $200 000 less than the asking price at 700,000, then work your way up from there. Also I was warned to stay away from auctions as you often end up paying a whole lot more at these for the house than it's worth.

All of this information I gathered from an Australian acquintance of mine who owns 5 houses in and around Melbourne and several small businesses. He's coming with me when I buy my house next year :D

Re: Can you negotiate on house prices?
 

No comment on the silliness of the question but any property is worth exactly how much you are willing to pay for it.
You can haggle and offer less, a lot less, the owner will reject or accept and you can increase incrementally. Of course, you may lose out if someone (real or fictional) makes an offer higher than yours.
Location etc and emand ghave a lot to do with along with owners keenenss to sell combined with his/her expectations and if they have already dropped the asking price they may be unwilling to drop further out of pride/mistaken belief that the property is worth more but you have to fathom out if they are in a hurry to sell etc.
The rules are the same in every country I have known.
I offered AUS$30k less and ended up paying 10k less than the asking price. The house was up for sale at AUS$50k higher a year ago.
Swings and roundabouts, buyer beware, value of investment can go up as well as down, etc etc

Andrew

Re: Can you negotiate on house prices?
 

Gosh, so many replies and so quickly.

Many thanks all, really useful information. We will certainly do our research area wise - which is what I'm collating now.

Cheers

Re: Can you negotiate on house prices?
 

It also depends on how much you want it. If you want it offer 650, if you can take it or leave it then offer 600. It is worth asking the agent if there have been any previous offers and what they were (obviously remember that he is working for the vendor - however he is also trying to shift the property). If what the agent says is in line with your research then you can take it as a guide.

Regards and Good Luck
Alistair
PS: Remember there is a lot of stamp duty to pay on a $700k property.

Re: Can you negotiate on house prices?
 

Also, haggling is more acceptable here, so you wont put peoples' noses out of joint if you start with a low offer.

Regards
Alistair

Re: Can you negotiate on house prices?
 

It will also depend on the area.

On the East coast prices are falling in some places but, for instance, in Adelaide Prices are steady or still rising.

Auctions and sealed bids are what to be careful with.

G

Re: Can you negotiate on house prices?
 

PS: Remember there is a lot of stamp duty to pay on a $700k property.[/QUOTE]

If you're looking at WA stamp duty would be about $30k :eek:

Slightly cheaper in Eastern states I believe...........

Re: Can you negotiate on house prices?
 

Stamp duty in Victoria (which I think may be the highest in Oz) would be $37660 on $700k house. These is also another stamp duty on the mortgage.

Regards
Alistair

Re: Can you negotiate on house prices?
 

Stamp duty estimates on a $700,000 purchase according to echoice would be:

NSW $26,990
VIC $37,660
QLD $18,750 (at Owner occupier rate)
SA $27,830
WA $32,300
NT $37,800
ACT $32,000
TAS $25,550

A year before the recent boom began to slow down, I was able to negotiate discounts, even on popular properties, due to being able to offer a cash purchase. One was only 2.5%, but another was 10%.

Re: Can you negotiate on house prices?
 

cheers for the clarification ABC :)

Re: Can you negotiate on house prices?
 

Is the stamp duty limit $700K?

Re: Can you negotiate on house prices?
 

:) No. Not sure if there are upper limits, but there are lower limits.

eg: Stamp duty on $10,000,000 = $656,750 in ACT, but only $367,500 in QLD

:D