How does the offer process work when buying a house in the UK?

[northernladuk]

Could always check out zoopla for current values and adjacent similar property sales figures.

Only go on the sales figures. The guesstimates are utter tripe.

[Daventry]

Could always check out zoopla for current values and adjacent similar property sales figures.

I did but those values are older than 12 months. Prices have gone crazy in London in the past year.

[Daventry]

There have been a number of articles about what agents are doing in London. Here is one of them...

Housebuyers gazumped in deals with NO rival bidders: Unscrupulous estate agents are persuading sellers to raise prices days before exchange of contracts | Mail Online

So there's no way to have a signed agreement prior initiating all the paperwork? Not even a private contract between both parties? There is such contract in other countries.

[Daventry]

Foxtons even before this current madness are one of the estate agents well known for driving up property prices and scamming people so avoid them.

Your best bet if you are interested in a property and the vendor lives in it, is to put a note through their door stating you are interested in the property and you will be making an offer with your name, email address and phone numbers. You still need to make the offer through the estate agent but if the vendor doesn't get an offer from you they can, if they are bothered, follow up.

Do all the offers have to be made through an estate agent? What if a friend comes to you interested in your property?

[Power Mortgages Ltd]

So there's no way to have a signed agreement prior initiating all the paperwork? Not even a private contract between both parties? There is such contract in other countries.

Nope. Until you have exchanged contracts you can pull out at any stage and likewise, the vendor can pull out at any stage for any reason too.

Unfortunately that is part and parcel of the UK market which is a shame as I have seen so many people lose out financially because of this.

Do all the offers have to be made through an estate agent? What if a friend comes to you interested in your property?

It depends if the property is already marketed with an Estate Agent. If the property is marketed by an Estate Agent then there is usually a contract in place between the Estate Agent and the vendor which means the Estate Agent will get x% commission from any sale for a period of x months. This stops someone seeing the [insert Estate Agent Company name] sale sign outside the property or the advert on Right Move and then just popping to the property to arrange a sale directly with the vendor so the Estate Agent would lose out on their commission (which wouldn't be a bad thing as far as I am concerned)!

If you are not marketing your property through an Agency and a friend wants to buy it then that is different and doesn't need to go through an Agent.

[Ticktock]

It depends if the property is already marketed with an Estate Agent. If the property is marketed by an Estate Agent then there is usually a contract in place between the Estate Agent and the vendor which means the Estate Agent will get x% commission from any sale for a period of x months. This stops someone seeing the [insert Estate Agent Company name] sale sign outside the property or the advert on Right Move and then just popping to the property to arrange a sale directly with the vendor so the Estate Agent would lose out on their commission (which wouldn't be a bad thing as far as I am concerned)!

If you are not marketing your property through an Agency and a friend wants to buy it then that is different and doesn't need to go through an Agent.

If that's true, then it's changed since I was an Estate Agent when I were just a spotty kid. Back then the contracts would say that the agency collect commission from any sale introduced by the agent - the introduction could very well be someone walking past and seeing a For Sale board outside, or seeing an advert in the window, on Right Move or wherever, but would not apply if the vendor independently made someone aware that they wanted to sell. Of course, they would always try to argue that they introduced the sale, but if it was a friend or family member buying then it would be hard to say that the agency did in fact make the buyer aware of the property, and not the vendor telling a mate "I'm selling my house".

[Daventry]

Nope. Until you have exchanged contracts you can pull out at any stage and likewise, the vendor can pull out at any stage for any reason too.

Unfortunately that is part and parcel of the UK market which is a shame as I have seen so many people lose out financially because of this.

In that case you lose the mortgage application fee plus all the fees for the searches performed by the solicitor, right? I guess you still get to keep the deposit and stamp duty because the sale didn't go through. Am I right? Apologies if this last question is silly but I'm flipping out with this matter...

[Smartie]

Buying a property in the UK, and particularly in London at the moment can be a nightmare. You have no legal agreement until you have signed the final contract (completion). Up until then, the vendor can withdraw without any penalty or increase the asking price at will.
Many people will be in a chain and if anyone in the chain does this it can break the whole thing and vastly increase the time it takes to successfully complete your purchase.

I had an offer accepted nine months ago and still have no completion date in sight. In that time the local property prices have increased by at least 10%. The vendor might well decide to up the asking price substantially and there would be nothing I could do about it except start the whole process again but with property a lot more expensive now.

In the Scottish system, once your offer is accepted it's a legal contract. God knows why we don't use a similar system.

In answer to your question, you lose any money you've spent so far but you still have your deposit and stamp duty because that's only payable on completion.

[kevpuk]

Buying a property in the UK, and particularly in London at the moment can be a nightmare. You have no legal agreement until you have signed the final contract (completion). Up until then, the vendor can withdraw without any penalty or increase the asking price at will.

Actually, from Exchange of Contract there is financial remedy potential......just saying

[Daventry]

I had an offer accepted nine months ago and still have no completion date in sight. In that time the local property prices have increased by at least 10%. The vendor might well decide to up the asking price substantially and there would be nothing I could do about it except start the whole process again but with property a lot more expensive now.

I guess I'll just be a tenant forever...

In the Scottish system, once your offer is accepted it's a legal contract. God knows why we don't use a similar system.

I guess these days there are a lot of parties interested in keeping this system. They'll think about it when the bubble bursts and it's the buyers who are in a position to pull out and reduce their offer upon exchange of contracts.