Tender process

[Jonty]

Hey all

Well tomorrow I am going to submit yet another tender on a house here in Wellers. Just though I would see how many of you have had the unfortunate experience of having to deal with "closed tenders"? The house I am looking at tomorrow has no price indication only its GV. I get the impression from the agent that we are the only ones in at the moment and I am shite scared we will put in an offer 50K higher than someone else or worse we are the only ones!!

Anyone got a startegy for these scenarios. I am thinking of tendering low (5K over GV) and including a letter to the vendors that says we have put forward out best offer, but if someone is higher let us know and we can reconsider.

What you guys think? I am quite keen on this one.

[kickingzebra]

Always write a nice letter, try and think of novel ways to solve their problems, if any, eg taking any rubbish or crap they have onsite, etc

Market rates are always an OK way to go, if you know where the market is at, then your tender should reflect well with what the real estate agent told them. If you are dead keen, splash out on a registered valuation, which you commission as a critical evaluation, then offer them that, plus a few thousand, and you have a nice paper trail to bargain with them.

[sAsLEX]

your agent should be abel to get you a list of all the houses sold in the area in the last wee while and compare there selling prices to the Gv's to see how the market is in that area, personally not a fan of tenders etc

[Blairos]

If you are dead keen, splash out on a registered valuation, which you commission as a critical evaluation, then offer them that, plus a few thousand, and you have a nice paper trail to bargain with them.

Yep - my thoughts exactly... the only thing a Tender does is favour the seller.

Get the registered valuation, it will be a fair representation of the house's value - they cost a few hundred, but are worth it in the long run - takes some of the guesswork out of a tender offer...

[James Deuce]

Tenders don't favour the seller, they favour the real estate agent. The real estate agent gets to go fishing for the current market value (for a fee) and then gets to sell the house through a "proper" listing for the commission. The idea isn't to sell the property by tender, it's to set the price for the listing.

Try to talk to the vendor directly and then try for a private deal. Get your lawyer primed first though.

Apologies first to any bike riding real estate agents, but I've met a grand total of one real estate agent who listened to what we were after and showed us the right type of house. We bought a house from him. The other 30 (I kid you not) not only missed out on a sale, when they go to hell, they will be responsible for organising some way of giving me back the huge chunk of my life they stole.

Private sales will save you $20k or more.

Ignore tenders. The real estate agent doing the deal is a wanker.

[Jonty]

Cheers guys

Unfortnuately I am a little late for a valuation. generally we are seeing houses go for over GV but the market is definatley slowing.

[kickingzebra]

Don't remind me about the slowing market, I have lost 80 grand in valuations in the last 6 months. Bloody media and self fulfilling prophecies of economic doom. Dum busstids

[Mrs Busa Pete]

[QUOTE=Jim2]Try to talk to the vendor directly and then try for a private deal. Get your lawyer primed first though.

Private sales will save you $20k or more.
Even if you go to vendor agent introduced you to property so he/she will will still get there commision.Propertys generally sell for around 20% above goverment GV.I would offer around 15% above. One other thing if your tender is the highest offer but still not enough the agent can then go into negotiation for you.What you can say to your agent is well we are $250 ? (or what ever price range you are in) buyers is it worth us putting in a tender hope this helps

[WINJA]

Don't remind me about the slowing market, I have lost 80 grand in valuations in the last 6 months. Bloody media and self fulfilling prophecies of economic doom. Dum busstids
REALLY? IVE MADE HUGE CAPITAL GAINS IN NTH WAIKATO , I SUPOSE WHERE I BOUGHT GIVES BUYERS A STAB AT 2 JOB MARKETS AUCK/HAMS WHICH HELPS , ESPECIALLY CAUSE I CAN GET TO GREEN LANE FASTER IN RUSH HOUR FROM HERE THAN I CAN GET THERE FROM MASSEY

[WINJA]

Cheers guys

Unfortnuately I am a little late for a valuation. generally we are seeing houses go for over GV but the market is definatley slowing.
IF YOU PAY A LITTLE TOO MUCH ITS NOT SO BAD IF YOUR THE TYPE THAT BELIEVES IN 'TIME IN THE MARKET' NOT 'TIMEING THE MARKET'.
5K OVER CV DONT SOUND TO RISKY

[WINJA]

good luck and if you can try to enjoy the game

[kickingzebra]

Still made capital gains, but lost potential profit, if sold at peak.
I'm still in the market though, and gonna buy more as soon as these ones sell, just be more careful about what and where.

We're in it for the love of the game anyway, so just rolling with the punchs, and trying to not become over extended. But wife is pregnant, which is neccesitating a rethink of investing strategy, can't just go off income now, have to make the investment make money more readily.

[Jantar]

I have just made a successful offer on a new property, negotiated a price satisfactory to both parties, and it is conditional on selling our present property. I will not buy via tender nor auction, nor will I sell by either method. Tenders and auctions are only of benefit to the agent, neither will atract the greatest number of potential buyers, and auction will only ever achieve the 2nd highest price plus a bit, never the highest price.

My advice to you is to tell the agent that you are interested in the property and to come back to you if it doesn't sell in the tender round. Chances are you will be the purchaser, but on your terms.

[Timber020]

We brought our house late last year via tender

IT SUCKED

They came back to us 4 times for higher figures, if they wanted an auction then they should have had a bloody auction. GV isnt much of a guide unless you add about 30% to it. Then your getting close to market rates.

GOOD LUCK MATE! Its only worth it if its got a double garage

[slowpoke]

Recently returning from Oz we couldn't believe the number of "tenders', "by negotiation", "POA" etc in the local real estate bum wipes. All of them just turned us right off and we didn't even bother looking at 'em. Surely if the agent knows their market they can price a property accordingly...if they can't then I'd be looking elsewhere to both sell or buy a property. Their commission is based on both knowledge of the area and performance of their selling duties so if they can't even put a price on it then why should they get full commission?
Personally, if it hasn't got a price I instantly switch off, even if I'm genuinely in the market, and I reckon most people are the same.
Good luck mate!

[Jonty]

Well we WON!! Put in a low offer (3%) over GV and got it. Now I am resigning myself to nvere going out again:bye:

[kickingzebra]

Congrats!! now if you have a smart lawyer, you might be able to claw a little money back in maintenance, any unpermitted work, and rates. worth a look.

[Jonty]

Congrats!! now if you have a smart lawyer, you might be able to claw a little money back in maintenance, any unpermitted work, and rates. worth a look.

Trouble is I am a lawyer and managed to get that all tidied up prior - oh well

[kickingzebra]

My condoloences ;) I'm sure you're not really a bad person!! LOL
Hope the house is everything you dreamed!
What suburb is it?

[Jonty]

My condoloences ;) I'm sure you're not really a bad person!! LOL
Hope the house is everything you dreamed!
What suburb is it?

Ha ha - I am a banking and finance lawyer so only fleece corporations:yes: Yes house is fantastic thanks. It's in the Wadestown Wilton Area.

[kickingzebra]

Fleecing flocks is better than sharing socks!!
I don't know area, oh well, I'm sure it is great!!

[Timber020]

Congrats man! Hope it has a huge shed, Im in karori, might see you about

[Winston001]

Congratulations on the purchase.

Just my 2 cents. I don't like auctions or tenders and completely endorse other comments here. They are usually a sneaky way of agents getting you to pay for the advertising without them digging into their outrageous commissions.

However there are 2 situations where they are justified:

1 When a property is unique eg. a converted church, or an architect's orgasm. Nothing else like it around to compare.

2 When the vendor has no rational idea of what the real market value is. A tender or auction brings a helpful bucket of cold water to the party. Of course the agent could have been honest at the start but then they'd have lost out to some other greasy colgate blazer-wearing slimeball who'd promise anything to get the listing.