OPINION
Photo © Mike Prior
WORLD
TV presenter and property expert Jonnie Irwin gives his thoughts and views on first time buyers and the housing market
I bloomin’ love a deal me! Doesn’t matter if I’m in a fancy clothing boutique, an antiques shop or buying a car, I’ll always try to negotiate. Maybe it stems from the days of when I was skint – I put myself through university and could regularly be found in Cash Converters selling my stuff for cash. There’s a chance it’s more innate than that – perhaps it’s a competitive streak where I don’t like to walk away from a deal thinking someone’s got the better of me. Either way, it’s not very cool is it? When it comes to buying property, most people are guilty of wanting to do a deal. We are normally dealing with relatively huge numbers – for most people it’s the biggest financial outlay of that time of our life. Of course, we will want to strike a deal where we don’t quite pay the full asking price – it makes the deal feel a little in our favour and at least subconsciously we savour the victory when a discount is negotiated. My consultancy business (where I help people to buy property) even has a fee structure that incentivises me to get the best possible price. And so it should. But there’s a fine line to be drawn. When I’m the person tasked with submitting the offer on a client’s behalf I often question (usually in my head) the thought process behind the figure. I’ve been flabbergasted by couples who have fallen head over heels with a property and been reduced to tears when I tell them it’s, say, £20,000 below their budget, only for them to put in a derisory offer. Don’t get me wrong, there’s a time and market for a cheeky offer, but any reduction has to be justifiable. That, I suppose, is the intriguing thing about property – there’s no fixed rule but more of a nuanced way of how best to go about things. I’ve written in this column before about negotiating and it’s a subject that fascinates me because of the human element. And it’s just this human element that makes some deals hard to predict. I have recently been trying to buy a new home for my family and had the frustrations of being stuck in a chain – something most first time buyers among you will be blissfully unaware of. It finally got to the day of exchange and we got gazumped. I repeat – on the actual day of exchange. Everything was signed, the money was in place and someone came along and tempted the owner to deal with them. I even got into a bit of a bidding war until eventually I realised that whoever I was bidding against was prepared to throw more money at it than me and I had to think of my budget. Now I’ve always been pretty cold blooded about property, but my wife and I became quite emotionally attached to the idea of this house. Losing it in the manner we did was a shock and acutely unpleasant. Hindsight, of course, is a wonderful thing, but it can also keep you up at night. I wondered what I could’ve done differently. The reality is not a lot – it’s difficult to legislate for greed, but it has reminded me as to my advice for first time buyers when offering on a home. Your budget should always be the overriding cut-off point as to the highest you can afford to offer. Many property markets in the UK will see a lot of activity this year, with buyers in competition with one another. There really is no substitute for research. If you’ve watched the property market for a decent amount of time through the portals, agents and developers’ websites, then you will have a decent handle on what places are selling for and then ultimately you should know if a property is worth the asking price, or a bit more or less. Just last week I was getting a coffee and the shop owner asked for advice on a place he was trying to buy. He had put in an offer on a flat which had also received other bids from buyers in excess of the asking price. He had been asked to submit a “best and final” offer by the end of the week. My advice to him was to remind himself of his own budget and assess how much (if anything) he would need to spend on the flat. Then, ignoring everyone else, submit the maximum figure he could not only afford, but would be comfortable with. Nothing more or less. If it sells for more than his bid, then he knows he’s done all he can with no regrets. I didn’t ask him to try to find out who the other buyers were or second guess what someone else might go up to. Control what is within your sphere of influence and do all you can if you’ve fallen in love with a place. If it doesn’t work out, then dust yourself down and go again. What happened to the first time buyer I hear you ask? Well, he got the place and is chuffed to bits. Oh, and I got a free coffee. Small victories. First Time Buyer June/July 2021 9
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18/05/2021 15:48
