Buying your first home is by turns exhilarating and terrifying. Lockdown has made things even more challenging: many urban renters are considering buying somewhere out of town where they can get more home for their money, and at the same time fewer properties are coming to market. While the easing of lockdown restrictions will help, demand is still outstripping supply in many areas – meaning buyers must be on top of their game or risk missing out when they find the home they want.
The good news for first-time buyers is they have a head start when it comes to being “proceedable”. This is estate agent code for an attractive buyer who will go to the top of the pile if there are several pursuing the same property. The reason is first-time buyers are not in a chain – ie they don’t need to sell their current home before they can move. But to be fully proceedable, you should have your deposit ready to go and a mortgage approved in principle. With that sorted, you can start looking. When you do:
Remember the estate agent is not working for you but for the seller. Their job is to sell the property for the highest price possible, and everything they do and say will be with this goal in mind. Whenever you meet them – either virtually or at a physical viewing – they will be gauging how proceedable you are and how far they can stretch your budget.
On a viewing, be mindful of the signals you give off. Even if you love a property, resist the temptation to gush – either to the agent or to anyone else you are viewing with. Over the years I’ve seen buyers who are instantly smitten with a place get flushed or even giddy. While there are few emotions as exciting as the first flush of property love, revealing your hand like this will not help your negotiating position.
Before making an offer for a property, get as true a sense as you can of its value. Remember the asking price is not the same as the value – it’s the seller’s aspiration. Read up on similar homes in the area and find out how much they’ve sold for. Comparing properties of a similar size and location should give you a benchmark figure, which you can adjust by considering other factors such as which school catchment area the property is in, transport links and so on.
Calibrate your first offer carefully, taking into account the length of time the property has been on the market, the owner’s reason for selling and how much interest they have had from other buyers.
If you have to haggle on price, don’t forget to press home your first-time buyer advantage. Because you are not reliant on your own sale going through, the seller is more likely to accept a lower offer from you than they would from a buyer who is less proceedable.