Last updated: 07/04/2021
Ready to make an offer on your first home? This is a really exciting part of your home-buying journey but it’s important not to rush in. Once you’ve seriously considered whether the property is right for you, here’s how to get prepared to make an offer.
The information given on this page applies only to properties in England and Wales, and not to properties in Scotland, where the law is different.
Think about how much you can afford to spend beforehand, and stick to your budget. As well as the price of the property itself, take other outgoings into account. Things like council tax and utility bills will impact how you budget for your home.
There may be factors which allow you to haggle the price. For example, if the property’s Energy Performance Certificate (EPC) rating is poor, you could ask for a lower price as you’ll probably have to make improvements to the property in future.
You’ll need to get to grips with some new words and phrases. For starters, there is a ‘guide price’, which is the approximate amount the owner hopes to sell their property for. You might also hear it referred to as the ‘asking price.’
You also might see ORIO (offers in region of the guide price) which can mean the seller is willing to consider a slightly lower offer; or OIEO (offers in excess of the guide price), which means they’re interested in offers that meet or exceed the guide price advertised.
Do your research and try to find out how much similar properties are selling for in the same area. If they’re going for a price lower than the asking price, you could try making a lower offer.
However, it’s a delicate balance. If you put in an offer that’s too low, another buyer could have their offer accepted instead. It can sometimes help to ask the estate agent how many other offers the property has received. If you find yourself competing against lots of other buyers, we have some tips on how to get through a bidding war.
Put the groundwork in long before you actually make an offer: when you first speak to an estate agent, it’s a good idea to downplay the max amount you’re willing to spend on your first home. It’s the same if you view a property that you love. Don’t let on that you think the property is amazing; play it cool and instead concentrate on asking the right questions.
To make your offer, call the estate agent and tell them how much you want to spend. Then follow it up by putting your offer in an email, for the agent to forward to the seller.
However much you decide to offer, be confident and don’t feel the need to apologise for making an offer below the asking price. Always make it clear that your offer is subject to a survey and contract.
You do want to make yourself an appealing buyer – especially if you’re making an offer below the asking price. You can do that by emphasising that you are a first-time buyer, so you’re not stuck in a property chain. You could also offer to be flexible on your moving-in date. And having a mortgage in principle ready (an estimate of how much you can borrow from a mortgage lender) can help reassure the seller that you’re a serious buyer.
What happens next?
- It can be a long process, but once your offer is accepted and the house is off the market, then you’re on your way to becoming a homeowner at last. If the seller is interested in your offer then you’re likely to enter into negotiations, carried out by the estate agent. There may be some back-and-forth before you agree a final price, so this is where having your maximum price decided beforehand is essential. Don’t get carried away, and always stay within your means.
- If your offer is accepted, ask the estate agent to take the property off the market. They should agree to stop carrying out viewings with other potential buyers, so you’re less likely to get ‘gazumped’ (when a seller accepts a higher offer from someone else).
If you’ve had an offer accepted, congratulations! Once you’ve celebrated, it’s time to get serious with the sums. Find out where to spend and where to save when buying a house.