Go Back   English Forum Switzerland > Help & tips > Housing in general  
Reply
 
Thread Tools Display Modes
  #1  
Old 21.02.2007, 12:44
Termite's Avatar
Junior Member
 
Join Date: Jan 2007
Location: Basel
Posts: 77
Groaned at 0 Times in 0 Posts
Thanked 2 Times in 2 Posts
Termite has no particular reputation at present
Making an offer on a house

When you have found a house you wish to buy, and it is for sale, what is the etiquette for making a bid? The friendly people at the bank have given me a maximum price they would loan a mortgage against, i.e. 80% of the amount they think it is worth. This value is approximately 5% less than the asking price. Do I use the 10% rule and start 10% lower than this value and expect to negotiate, or do I only make a single offer, justified by the bank valuation?

The apparent honesty of the agent is somewhat off-putting. He said that no one else has shown any interest in the house and said what the market price would be if it weren’t for the “improvements”. One man’s improvement is another’s eyesore though. Give me a slimy agent in a BMW any day; you know they will be having a laugh with the price, so feel obliged to make a very low offer. Over here I get the feeling it is not like that.

Any advice gratefully received.

Thanks
Reply With Quote
  #2  
Old 21.02.2007, 12:55
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,076
Groaned at 344 Times in 234 Posts
Thanked 11,552 Times in 3,984 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Making an offer on a house

There aren't really any rules for this, as the purchase and sale of property is relatively rare. The golden rule is 'can I resell it?'. If there has been no interest, what chance of that?

Another adage is 'you can always go up in price, but not down' with your offer. I'd try 15 or 20% under and see what happens, you can always up it.

BTW, in my experience mortgage lenders (banks) tend to undervalue properties they are lending on - reduces their risk. So 5% under seems to be their valuation - unless they have never inspected the place, and that wouldn't surprise me...
Reply With Quote
  #3  
Old 21.02.2007, 13:05
BHBT's Avatar
Forum Veteran
 
Join Date: May 2005
Location: was Züri
Posts: 957
Groaned at 19 Times in 16 Posts
Thanked 901 Times in 415 Posts
BHBT has a reputation beyond reputeBHBT has a reputation beyond reputeBHBT has a reputation beyond reputeBHBT has a reputation beyond reputeBHBT has a reputation beyond repute
Re: Making an offer on a house

I tend to agree with AbFab but have to also say that when we started our househunting here, we actually had one architect (not real estate agent) decline to discuss the options any further, after we put in what he felt was an insulting bid (20% below asking price). This was a huge surprise to us, after experiences in Australia where starting low and bargaining is the rule.
So...it is worth a try but perhaps better with agents, rather than when dealing with the architect/developer/builder directly.
Reply With Quote
  #4  
Old 25.02.2007, 15:07
Newbie
 
Join Date: Feb 2007
Location: Zurich
Posts: 9
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
Jaye has no particular reputation at present
Re: Making an offer on a house

The best is to understand the process of realestate agent or seller, so that if you decide to offer (for example) significantly below the value if you will have second chance to up your bid.

The bidding processes can vary based on the house / property and realestate agent you have to deal with. The property sellers themselves may have certain requirements that they wish you to satisfy.

For example: We chose to bid above the asking price for our current property at a rate that was sufficiently above the next lowest price not to generate another bidding round and to have a high chance of success. This was a straightforward sale of an apartment with a realestate agent in the middle. The seller simply wanted the best price, quickly and the ability to overcome a right to buy by the neighbouring property. Our current property was however in high demand and by the time I viewed the property all advertising had been stopped.

A second example was another property where there were multiple bidders. In this case the process was all bidders that submitted a first bid would have transparency of the highest bid and the ability to bid again. There were additional requests of the seller such as maintaining current tennants at current rental rates which they asked the buyer try to accommodate. In this case, I bid significantly below the asking price in order to have transparency of the second round alongside preparing a short information on the criteria the seller had asked for that I could satisfy (which were not all).

As you can see, the processes can vary significantly if you choose to bid below the asking price and you really want the property you need to ensure you have the opportunity to bid again or take the risk you may not get the property. Most importantly you need to understand the process and what is important to the seller.
Reply With Quote
  #5  
Old 04.03.2007, 18:14
Felix's Avatar
Member
 
Join Date: Oct 2006
Location: Zug
Posts: 114
Groaned at 3 Times in 2 Posts
Thanked 23 Times in 13 Posts
Felix has made some interesting contributions
Re: Making an offer on a house

Given the thinness of the market in Schweiz, I suggest you only buy where the market is active and you even feel you are overpaying - otherwise you risk getting really stuck on the resale
Reply With Quote
  #6  
Old 30.03.2007, 13:16
Member
 
Join Date: Nov 2006
Location: England and CH1844
Posts: 185
Groaned at 0 Times in 0 Posts
Thanked 17 Times in 13 Posts
clive7 has made some interesting contributions
Making an offer on an apartment

Is it usual in Switzerland for offers on resale apartments to be made below the asking price? Or do most prospective purchasers offer the asking price?
Reply With Quote
  #7  
Old 30.03.2007, 13:22
Guest
 
Posts: n/a
Re: Making an offer on an apartment

From what I gather, reactions to lower offers vary considerably, some report the vendor being almost insulted, and preferring for their house to remain unsold for years rather than suffer the indignity of lowering their price.

I would say try it. Anything is negotiable. You are talking about huge sums of money here that could be saved through simple discussion.

dave


Quote:
View Post
Is it usual in Switzerland for offers on resale apartments to be made below the asking price? Or do most prospective purchasers offer the asking price?
Reply With Quote
  #8  
Old 30.03.2007, 13:31
Termite's Avatar
Junior Member
 
Join Date: Jan 2007
Location: Basel
Posts: 77
Groaned at 0 Times in 0 Posts
Thanked 2 Times in 2 Posts
Termite has no particular reputation at present
Re: Making an offer on a house

I was speaking to a lady at PostFinance re mortagages, and she made an interesting comment. She said that I had a problem because it was obvious I was an expat, and that a seller might try to confuse me into paying too much. I should let an expert (from PostFinance) value the property and then everyone can sit down and find the right price.

Would I be cynical if I thought in that senario everyone, apart from me, wants the highest price possible?
Reply With Quote
  #9  
Old 30.03.2007, 13:35
Lou's Avatar
Lou Lou is offline
Forum Legend
 
Join Date: Mar 2006
Location: Zurich
Posts: 3,782
Groaned at 9 Times in 9 Posts
Thanked 3,227 Times in 1,474 Posts
Lou has a reputation beyond reputeLou has a reputation beyond reputeLou has a reputation beyond reputeLou has a reputation beyond reputeLou has a reputation beyond reputeLou has a reputation beyond repute
Re: Making an offer on a house

Quote:
View Post
I was speaking to a lady at PostFinance re mortagages, and she made an interesting comment. She said that I had a problem because it was obvious I was an expat, and that a seller might try to confuse me into paying too much. I should let an expert (from PostFinance) value the property and then everyone can sit down and find the right price.

Would I be cynical if I thought in that senario everyone, apart from me, wants the highest price possible?
That sounds normal when buying a house to me
Reply With Quote
  #10  
Old 30.03.2007, 14:00
Guest
 
Posts: n/a
Re: Making an offer on a house

But its your money. Postfinance may or may not lend it to you, but their interest is primarily ensure their loan is adequately covered by the property value.

I'm not sure about this "everyone sitting down" bit. It sounds a bit too cosy to me...

I would suggest an independent property evaluation.

dave



Quote:
View Post
I was speaking to a lady at PostFinance re mortagages, and she made an interesting comment. She said that I had a problem because it was obvious I was an expat, and that a seller might try to confuse me into paying too much. I should let an expert (from PostFinance) value the property and then everyone can sit down and find the right price.

Would I be cynical if I thought in that senario everyone, apart from me, wants the highest price possible?
Reply With Quote
  #11  
Old 30.03.2007, 14:33
Member
 
Join Date: Nov 2006
Location: England and CH1844
Posts: 185
Groaned at 0 Times in 0 Posts
Thanked 17 Times in 13 Posts
clive7 has made some interesting contributions
Re: Making an offer on a house

Quote:
I would suggest an independent property evaluation.

dave
How do you get an independent valuation in Switzerland? What would it cost? A % of the valuation price?

I am asking these questions because I have made an offer at the asking price and the Vendor has reacted by increasing the price by CHF100,000!

He says he is considering my offer but after 5 weeks he still hasn't said Yes or No! The Agent sits in the middle telling me to be patient. Meanwhile other prospective buyers are viwing the property.
Reply With Quote
  #12  
Old 30.03.2007, 14:38
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,076
Groaned at 344 Times in 234 Posts
Thanked 11,552 Times in 3,984 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Making an offer on a house

Quote:
How do you get an independent valuation in Switzerland? What would it cost? A % of the valuation price?

I am asking these questions because I have made an offer at the asking price and the Vendor has reacted by increasing the price by CHF100,000!

He says he is considering my offer but after 5 weeks he still hasn't said Yes or No! The Agent sits in the middle telling me to be patient. Meanwhile other prospective buyers are viwing the property.
I had a house value here - the cost was CHF2,400. But the report was in a bound folder with colour pictures...
Reply With Quote
  #13  
Old 30.03.2007, 14:47
Member
 
Join Date: Nov 2006
Location: England and CH1844
Posts: 185
Groaned at 0 Times in 0 Posts
Thanked 17 Times in 13 Posts
clive7 has made some interesting contributions
Re: Making an offer on a house

Quote:
View Post
I had a house value here - the cost was CHF2,400. But the report was in a bound folder with colour pictures...
Was the valuation carried out by an Estate Agent or a property valuer? Is there a Register of qualified valuers? Did the Report just give a 'price' or was it more of a Survey telling you what, if anything, was wrong with the property?
Reply With Quote
  #14  
Old 30.03.2007, 14:54
Lob's Avatar
Lob Lob is offline
Forum Legend
 
Join Date: Nov 2005
Location: -
Posts: 7,814
Groaned at 45 Times in 40 Posts
Thanked 1,973 Times in 1,060 Posts
Lob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond repute
Re: Making an offer on a house

I just had my house valued for free by my local tax office

Also the lender agreed with me that the price paid for the location and house was in-range. But that was a new build....
Reply With Quote
  #15  
Old 30.03.2007, 16:20
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,076
Groaned at 344 Times in 234 Posts
Thanked 11,552 Times in 3,984 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Making an offer on a house

Quote:
View Post
Was the valuation carried out by an Estate Agent or a property valuer? Is there a Register of qualified valuers? Did the Report just give a 'price' or was it more of a Survey telling you what, if anything, was wrong with the property?
It was a valuation made by Engel & Partner of Zurich (http://www.swissregional.ch/index-3101.html) and was far too detailed and covered 20 pages with photcopies of the Grundbuch entry and so on.

It gave 'Building value', 'Land value' and finally 'Realwert', which in my opinion was a conservative figure.
Reply With Quote
  #16  
Old 30.03.2007, 16:21
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,076
Groaned at 344 Times in 234 Posts
Thanked 11,552 Times in 3,984 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Making an offer on a house

Quote:
View Post
I just had my house valued for free by my local tax office <snip>
You'll be very sad as that valuation (Eigenmeitwert) will go down...

Last edited by AbFab; 30.03.2007 at 17:25.
Reply With Quote
  #17  
Old 30.03.2007, 16:26
Lob's Avatar
Lob Lob is offline
Forum Legend
 
Join Date: Nov 2005
Location: -
Posts: 7,814
Groaned at 45 Times in 40 Posts
Thanked 1,973 Times in 1,060 Posts
Lob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond reputeLob has a reputation beyond repute
Re: Making an offer on a house

Quote:
View Post
You'll be very sad as that valuation (Eigenmeitwert) will go down...
that's good news [tax-wise] except of course I still have to have it insured for what it would cost to build.

Last edited by AbFab; 30.03.2007 at 17:26.
Reply With Quote
  #18  
Old 30.03.2007, 19:50
dannyt986's Avatar
Forum Veteran
 
Join Date: May 2005
Location: Wollerau, Schwyz
Posts: 1,834
Groaned at 26 Times in 19 Posts
Thanked 725 Times in 486 Posts
dannyt986 has a reputation beyond reputedannyt986 has a reputation beyond reputedannyt986 has a reputation beyond reputedannyt986 has a reputation beyond repute
Re: Making an offer on a house

Quote:
View Post
I am asking these questions because I have made an offer at the asking price and the Vendor has reacted by increasing the price by CHF100,000!

He says he is considering my offer but after 5 weeks he still hasn't said Yes or No! The Agent sits in the middle telling me to be patient. Meanwhile other prospective buyers are viwing the property.
He's just trying to scare you into paying the 100kchf and frankly its real arsehole behaviour. I suggest you say... "my offer stands until X time (say 24 hours later) in which case I withdraw it, permanently". Of course you need to have the attitude "there are other birds in the bush". If you really want it you could always up the price a bit along with this ultimatum.

Daniel
Reply With Quote
Reply




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
House buying Pedigreeman Housing in general 28 07.12.2010 15:28
Renting a house in SW of Zürich Wehmi Other/general 10 05.12.2006 18:37


All times are GMT +2. The time now is 13:26.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0