Making an offer on an apartment

Pumpkinpina · 11-01-2025, 09:30 AM

Can someone help me navigate the buying strategy?

I am looking to buy an apartment in Sham Shui Po, 400sqft about and they are all very similar in terms of quality.

25th floor - 5.05m listing price - the seller is urgent and no one living inside
23rd floor - 5.15m listing price - seller currently renting out to someone else
22nd floor - 5.18m listing price - seller currently renting out to friend

I'd be okay with any of these units as I will do renovations and they are all high floor. It looks like the sellers are aware that there are similar flats on sale. The last transaction was at 5th floor for 4.6m (with extra platform space, about a month ago. Since then, only 1 transaction last year. What should my strategy be to get the best price and how much is a reasonable starting offer? I was thinking if I should let 1 unit sell first, and let the 2 compete on lower price as they wouldn't wanna be the last to sell. Or I should put out a low price for all 3 units and see who accepts?

I also know the market may still be going down slightly as well.. Thanks for the help.

Cheeky Kiwi · 11-01-2025, 09:57 AM

i'd go after the 25th floor and offer 4.28m, ideally buying at 4.5m and not paying more than 4.6m

Pumpkinpina · 11-01-2025, 10:13 AM

I thought that the floor 25 price would be a lot higher than floor 5? Would it be considered lowballing?

Cheeky Kiwi · 11-01-2025, 10:24 AM

a property is only worth what someone will pay

shri · 11-01-2025, 10:24 AM

Originally Posted by Pumpkinpina:

I thought that the floor 25 price would be a lot higher than floor 5? Would it be considered lowballing?

Urgency as you mentioned. Don't know what their circumstances are.

In addition to what Kiwi said, I would offer a good faith $25-50K check for the seller to sign the preliminary sale agreement.

I would also negotiate the agents fees down from standard.

Do you have a preliminary mortgage approval? Use that to push the seller.

Look for a 90 day closing (shorter if this is a cash purchase). Talk to a mortgage broker to make sure you have the best deal and how much banks are willing to lend you of you do not have a pre-approved / indicative amount from your primary bank.

Make sure you have your solicitor lined up

Check the lands registry site for the title of the flat and make sure no orders are registered against the flat

Talk to the management of the building and check if there are any major repairs or expenses due on the flat .. negotiate those amounts down from the sale price.

Check if the seller has a mortgage. And if they have the full title available.

Are all the three flats with the same agent?

Also line up your contractor to view the flat and check if any major repairs are required.

All of the above are not presented in chronological order.. figure out what is important before you pull the trigger on the preliminary agreement - this will lock you and the buyer in.

If you feel you do not understand the preliminary agreement consult with your solicitor.

Pumpkinpina · 11-01-2025, 10:31 AM

Yep, all three flats are with the same agent.

Also I just signed a lease in October, so I don't mind to delay the purchase or stall the sale or let 3 of the units outbid each other.

Thanks for your advice, this would be my first time buying a home.

"negotiate the agents fees down from standard." - for this i directly talk to the agent? And for the solicitor, I thought the agent would help? Where do I usually look for one?

shri · 11-01-2025, 10:32 AM

Originally Posted by Pumpkinpina:

I thought that the floor 25 price would be a lot higher than floor 5? Would it be considered lowballing?

It is your money. Let the seller come back with a counter if it is indeed an urgent / fire sale.

Be ready to walk away from it after you have presented a best and final offer. Make sure they understand why you are the best buyer they will find.

shri · 11-01-2025, 10:34 AM

Yes talk to the agent and tell them this is what you are willing to pay in agency fees .. they know the game. This has to be done before you make an offer.

Make sure the agent knows you are serious and that there are other equally good flats that you have seen with other agents they you are willing to close on if they cannot give you a discount on the fees.

In one case the agent had taken a full amount commission cheque to show the seller that the buyer was paying a full commission and the seller should do the same. A letter agreement was made that the commission would not be deposited and once the deal closes the commission will be paid as agreed.

Forgot to mention, make sure the commission is payable on closing ... Not before. This keeps the agent involved.