Should you take the first offer on your house?

Article summary

• An estate agent will be able to advise you on your chances of receiving a better offer.
• An old adage amongst estate agents if that the first offer is always the best offer.
• The longer your home stays on the market, the lower its value will fall.
• Investigate the buyer. If they’ve made offers on other homes in your area, they’ve probably done the research and know what the market value of your home is.

Signing the offer to purchase triggers the home buying process. It’s a binding agreement, so once it’s been signed, there’s no looking back.

So it’s no surprise home sellers may be reluctant to commit the first offer. Here we examine whether it’s based to take the offer or wait for a better one.

Should you take the first offer on your house?

There’s an old adage among estate agents that the first offer is always the best offer. So in most cases your estate agent will probably advise you to take the first offer.

Reasons for this include:

• The longer the house stays on the market, the lower future offers are likely to be.
• It’s a buyer’s market and inventory exceeds demand.
• You want to move into your new home and don’t want to have to cover two mortgages.
• A similar house to yours just sold for a lower price.
• Your home has unique traits that limits the pool of buyers who may show interest, such as nearby railways.
• If the buyer has made offers on other properties in your location, it means they’ve done their research and they know the area. A knowledgable buyer will offer what they know your home to be worth.

Hire an estate agent

You first step when selling a home should be to employ an estate agent. You can try selling the home privately, but estate agents have indepth knowledge of the market and will be able to advise you on your chances of receiving better offers.

How often is the first offer the best offer?

As mentioned, estate agents believe the first offer is always the best offer.

Of course, there are always exceptions. The offer may be way below the market value of your home, in which case you’d be in your rights to reject it.

What is an acceptable first offer on a house?

The offer may not be at the exact price you listed, but if it’s within 10% of the price, you should seriously consider it.

If it’s a full price offer on the first day, most agents would advise you to accept it. The chances of receiving an offer higher than your listing price are very low.

A cash offer should also be accepted, as it means the money will immediately be availabe, rather than dependent on the buyer’s credit record being high enough to receive a home loan.

For home buyers:

You should also be sure before signing the offer to purchase, that:

• The home meets your requirements.
• You can afford the home loan on the property.

Applying with the help of a home loan comparison service such as ooba Home Loans increases your chances of acquiring a home loan, as we submit your application to multiple banks. Even if your credit score is not within the optimal range, some banks may have less stringent lending criteria and may be willing to accept lower credit scores.

Applying to multiple banks also allows you to compare the packages they offer in return and choose the one best suited to your requirements.

We also offer a range of tools that can make the home buying process easier.  Start with our Bond Calculator, then use our Bond Indicator to determine what you can afford. Finally, when you’re ready, you can apply for a home loan.