Just because the "offer" comes on the first day of marketing, doesn't mean that "completion" won't take several more months!
"Ronald Raygun" wrote
Not necessarily - delays maybe due to the buyer dragging their heels with surveys, mortgage applications, planning permission queries etc - not to mention the fact that the rest of the chain maybe running slow, or a link in the chain waiting for an offer...
"Ronald Raygun" wrote
But if you will sell at the "six month old" price, then it *encourages* the buyer to drag their heels for the 6(or more) months!
[Or at least doesn't discourage them.]
"Ronald Raygun" wrote
But most buyers will expect the offer that they made several months before exchange, to be kept (or reduced if adverse points are found at survey).
"Ronald Raygun" wrote
That would be all well and good if buyers accepted prices being adjusted upwards (in a rising market) at time of exchange, for the delay they introduced between offer & completion. How do we educate the population? ;-)
But completion is not the relevant marker, exchange is. OK, so exchange (the unconditional acceptance of an unconditional offer) can itself take ages from an essentially meaningless conditional acceptance of a conditional offer, but if demand is seriously in excess of supply, this is not too likely, since the buyer will be keen to wrap up the deal in order to exclude competitors.
If a buyer wants to secure a property at the given price, he cannot afford to drag heels lest someone else snaps it up.
Chains? What are they? :-)
The prospect of losing the property should be discouragement enough.
Not if there's a danger they'll be outbid.
Simple. Tell them to take it or leave it. Naturally it takes a lot of confidence to say this. If there's a serious risk of this buyer turning round and leaving it, the seller must be confident there are others who're prepared to take it.
I wouldn't have put in a smiley if I didn't, would I?
As good as. The Scottish system generally does not make any attempt to achieve simultaneous completions as part of the negotiation process, and as a result negotiations are not hampered by such considerations, which makes the whole process much more predictable in terms of how long it will take.
It used to be the norm to have a survey done before making an offer, on the grounds that the offer was in principle capable of being accepted immediately. Offers subject to survey were, as a rule, generally rejected. Nowadays they still are rejected on paper, but practice has evolved to the point where the rejection is phrased as a conditional acceptance, the condition being that the "subject to survey" condition in the offer be removed, and a deadline for this being set, of typically one or two days, which is usually enough time to get a survey carried out and a verbal report back.
The system basically aims to achieve exchange more or less immediately, but builds in a completion delay of perhaps 4 to 12 weeks, the purpose of which is both to allow all the straightforward conditions to be met (deeds to be scrutinised, planning enquiries satisfactory, etc) and where appropriate for any chained transactions to be tied up independently.
The prudent thing is of course always to sell before you buy, and then because you know the date on which you will have your money, you can then propose that date together with an offer to buy. Sellers tend to consider both price offered and entry date when deciding whether to accept an offer.
But because of the high predictability, the imprudent can propose a long entry date and be reasonably confident of selling their own house within that time even if they haven't yet signed any contracts, and they usually get away with it.
Not necessarily. They might be ready and waiting, cash in hand, having already seen the place but been beaten to it by this guy who's now thinking of dropping out.
Of course he *might*. Or he might be inclined to worry that the present time-waster has yet more time-wasting tricks up his sleeve.
The problem with an expectation that buyers will hurry, for fear of losing a property, relies on them knowing/believing that there is a danger of losing the property.
1st time buyers have never had this experience, and have plenty of friends and barrack room lawyers, as well as their real lawyers, telling them not to be rushed; to pay attention to every last detail of their survey, and the myriad other reports recommended by the surveyor; not to pay for a search until they have a mortgage offer; that there is a law which prevents gazumping; and a myriad other things which slow the transaction.
Similarly, many non 1st time buyers have not had this experience either
- "last time I bought a house, I made the seller wait until I was absolutely ready, got £5,000 off the price, and completed when I wanted to".
As a consequence, mere threats or warnings usually do not work and, in order to put a rocket up their bum, you need to produce the alternative buyers before the action starts to hot up.
Then it ends in shouting and screaming, complaints, and tears - which some sellers and agents are reluctant to initiate....
Granted, but in my neck of the woods, there usually is.
In my neck of the woods, there are plenty of FTBs who miss out by not offering early, and even miss out when they do, by not offering enough.
Most surveys are short on detail, so paying attention to every last of them is easy.
If there are too many of these, then nine times out of a hundred it's best simply to walk away.
We never do a search until after exchange anyway. It's not usually paid for until the fat lady has sung, as part of the solicitor's outlays.
You should not even consider making an offer to purchase unless you have funds in place, such as by having obtained a lender's in-principle offer to lend up to £X provided this isn't more than Y% of price.
There is, but not until after exchange, which means it's of little use to the English who are so daft as to prolong the period of uncertainty, which -let's face it- is bad for both parties.
The survey apart, none of the above need slow the transaction.
Well, that sort of thing would happen only with a seller who's desperate and a buyer who knows it, and isn't.
Agreed, if the seller *is* desperate, he'd be ill-advised to try poker games. But if those alternatives buyers do exist, he'd have no need to play poker or make "threats". He should just break off negotiations.
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