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Property Problem Solver

PUBLISHED: 17:19 27 July 2012 | UPDATED: 21:40 20 February 2013

Amanda Ake offers advice on how to establish the 'correct' price of a property


HOW DO WE ESTABLISH THE CORRECT PRICE OF A PROPERTY



The property market is so confusing at the moment, with constant reports of price reductions, but also evidence that some properties weve viewed going to competitive bidding. How do we establish the correct price for a property and negotiate a good deal?



Buyers of country houses are in a difficult position. Prices are largely and are unlikely to show much in the way of an increase in the foreseeable future, but there continues to be a shortage. The consequence is that for some of the most desirable properties, competition among purchasers is pushing the price up above its real value. Theres also a large amount of property on the market that is overpriced.


You will need to figure out what ballpark the price should be in difficult when there are so few comparables due to a slow market. As a rule of thumb, look at the peak price in 2007 and subtract 30% to 35%; or compare the price directly with values in 2004/2005 where there should be parity. And ask the estate agents how they arrived at the price was it based on some science (if so, what), or just what the vendor thought it should be?


You can also find value by researching the position of the vendor. If the vendors are in no particular rush to sell, you may find negotiating more difficult; but if there is some level of pressure to sell due to their circumstances, you will almost certainly find more room for manoeuvre.


If you decide to make an offer, dont negotiate then and there with the vendor, always telephone the agent and go through the official channels. Even if an offer is accepted during a viewing, the vendor can renege on the agreement and you have shown your cards, leaving you exposed.


Remember, if you make any offer, the agent is obliged to put it to the vendor and also obliged to notify you if they receive another offer youre in the loop, so to speak.


Get your finances straight and have proof of finance ready to show the agent, in fact volunteer to show the evidence. There is nothing more alluring to a vendor than actual money being dangled in front of them, not just the promise of it. A solicitors letter will verify your position. If youre after something special, theres almost certainly someone else out there after it too. So dont give the estate agents or the vendors an excuse to turn you down."


Good luck!


Contact: Amanda Ake, Stacks Property Search and Acquisition; stacks.ake.co.uk; amandaake@stacks.co.uk


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