Making an offer on your first-home: Everything you need to know

12 minutes ago

6 min read

You've found a property you love, but what happens next? Finding your dream home is an exciting milestone, especially when you're buying for the first time. But once you've found a property that feels right, the next step, making an offer can feel a little daunting.

How much should you offer? Can you negotiate the asking price? What happens if your offer is rejected? And what should you do once it's accepted?

The good news is that making an offer doesn't have to be complicated. With the right preparation and understanding of the process, you can approach this important stage with confidence. In this guide, we'll walk you through everything you need to know about making an offer on your first home in England and Wales.

Contact Home at Last today to book a free consultation.

1. Get your finances ready before making an offer

Before you start negotiating, it's important to understand exactly what you can afford. Estate agents and sellers are more likely to take your offer seriously if you can demonstrate that you're financially prepared.

Here are a few things to have in place:

Mortgage Agreement in Principle (AIP): This gives an indication of how much a lender may be willing to lend you, subject to further checks.
Your deposit: Know how much you've saved and how much you'll need towards the purchase.
Additional costs: Budget for solicitor fees, surveys, mortgage fees, moving expenses and any applicable Stamp Duty Land Tax.
A solicitor or conveyancer: Research your options and ideally have someone ready to instruct once your offer is accepted.

Just because a lender indicates you can borrow a certain amount doesn't mean you should stretch your finances to the maximum. Make sure your potential mortgage repayments remain comfortable alongside your other living expenses.

2. Research the property and local market

Before deciding how much to offer, take some time to research the property and surrounding area. The asking price is what the seller hopes to achieve, but it isn't necessarily what the property is worth.

Consider the following:

How much have similar properties in the area recently sold for?
How long has the property been on the market?
Has the asking price been reduced?
Does the property require repairs or renovations?
Are there other comparable properties available nearby?

You can check sold property prices through the Land Registry and property websites such as Rightmove and Zoopla.

Understanding the local market will help you decide whether the asking price is reasonable and give you a stronger position when making an offer.

3. Decide how much to offer

One of the biggest questions first-time buyers ask is: "Should I offer the full asking price or start lower?"

The answer depends on the property, local demand, your budget and the seller's circumstances.

You may consider offering below the asking price if:

The property has been on the market for several months.
Similar properties have sold for less.
The home requires significant repairs or improvements.
The seller appears keen to achieve a quick sale.

However, if the property is particularly popular or attracts several interested buyers, you may need to make a more competitive offer. Remember, there's no fixed rule that says you must offer a certain percentage below the asking price.

Set your maximum budget before entering negotiations and stick to it. It's easy to become emotionally attached to a property, but your financial wellbeing should always come first.

4. How do you actually make an offer?

Once you've decided on an amount, you'll usually submit your offer through the estate agent marketing the property. You can make an offer by telephone or email, although it's often helpful to confirm it in writing.

The estate agent may ask you to provide:

Your proposed purchase price.
Confirmation that you're a first-time buyer.
Details of your mortgage Agreement in Principle.
Evidence of your deposit or proof of funds.
Your solicitor's or conveyancer's details, if available.
Your preferred timescale for moving.

Why being a first-time buyer can work in your favour

As a first-time buyer, you're usually chain-free, meaning you don't need to sell another property before purchasing. This can make you attractive to sellers who want a straightforward transaction.

In some situations, a seller may even prefer a slightly lower offer from a well-prepared, chain-free buyer rather than a higher offer from someone involved in a complicated property chain. However, being chain-free doesn't guarantee that your offer will be accepted.

5. What Happens After You Submit Your Offer?

Once you've submitted your offer, the estate agent will communicate it to the seller.

In England and Wales, estate agents are generally required to pass offers to the seller promptly and in writing, unless the seller has given specific written instructions otherwise.

The seller can then:

Accept your offer: Great news! You can begin progressing with the purchase.
Reject your offer: You can decide whether to submit a higher offer or continue searching.
Make a counter offer: The seller may suggest a price somewhere between your offer and their asking price.

If your first offer is rejected, don't be discouraged. Negotiation is a normal part of buying a property. Take time to consider your next move rather than feeling pressured to increase your offer immediately.

6. What happens when your offer is accepted?

Congratulations! Having your offer accepted is an exciting step towards becoming a homeowner, but there's something important to understand. In England and Wales, an accepted offer is not normally legally binding until contracts have been exchanged.

This means that both you and the seller can generally withdraw from the transaction before exchange, although you may lose money already spent on surveys, searches and legal work.

Once your offer is accepted, the next steps usually include:

Instructing your solicitor: Your solicitor or conveyancer will begin the legal process, including property searches, reviewing contracts and raising enquiries.
Applying for your mortgage: You'll submit your full mortgage application, and the lender will carry out its affordability checks and property valuation.
Arranging a property survey: A professional survey can help identify issues such as damp, structural concerns or repairs that may not have been obvious during your viewing.
Reviewing the findings: If significant issues are discovered, you may need to obtain repair quotations or discuss your options with your solicitor and mortgage adviser.
Exchanging contracts: Once all the necessary checks are completed and both parties are ready, contracts are exchanged. At this stage, the purchase becomes legally binding, and withdrawing could have serious financial consequences.
Completion day: This is the day the remaining purchase funds are transferred, ownership is completed and you can collect the keys to your new home!

7. Common Mistakes First-Time Buyers Should Avoid

Making an offer can be exciting, but there are a few mistakes worth avoiding.

Offering more than you can comfortably afford: Don't allow competition or excitement to push you beyond your financial limits.
Failing to research the property's value: Always compare the asking price with similar properties and recent local sales.
Not having your mortgage finances prepared: An Agreement in Principle can help demonstrate that you're a serious buyer, although it isn't a guarantee of mortgage approval.
Skipping the property survey: A mortgage valuation is not the same as an independent property survey. A survey may reveal problems that could become expensive later.
Assuming the property is yours once the offer is accepted: Until contracts are exchanged in England and Wales, the transaction can still fall through.
Forgetting about additional costs: Your deposit isn't the only expense. Make sure you've budgeted for the full cost of buying and moving.

8. Five tips for making a successful offer

Here are five practical ways to strengthen your position:

1. Be prepared: Have your deposit, Agreement in Principle and solicitor arrangements ready.

2. Know your market: Research local property prices and comparable sales.

3. Highlight your first-time buyer status: Being chain-free can be an advantage.

4. Communicate professionally: Be polite, clear and responsive when dealing with estate agents.

5. Know when to walk away: If the price exceeds your budget or the property doesn't meet your needs, be prepared to continue your search.

Remember, the goal isn't simply to have an offer accepted. It's to buy a home that suits your needs and remains affordable in the long term.

Make your first offer with confidence

Making an offer on your first home is a significant milestone, and it's perfectly normal to feel a mixture of excitement and nerves. The key is to be informed, financially prepared and realistic about what you can afford. Whether your first offer is accepted, rejected or leads to further negotiations, every step is part of your home-buying journey.

Remember, you don't have to navigate the process alone!

Let Home at Last help you take the next step - we're passionate about helping first-time buyers understand their options and navigate the journey to homeownership with confidence. Whether you're just beginning your property search, exploring affordable housing schemes or preparing to make your first offer, we're here to support you.

Ready to take the next step towards owning your first home? Book your FREE consultation with Home at Last today or visit www.newhomeatlast.com to find out more.

Disclaimer: This article provides general information about buying property in England and Wales and does not constitute legal, financial or mortgage advice. Property transactions and legal procedures differ in Scotland and Northern Ireland. Always seek appropriate professional advice for your circumstances.